The chart patterns of gold and silver have made significant bullish breakouts since my earlier post two weeks back. As often happens with bullish breakouts, investor interest has risen proportionately. I received quite a few queries whether this is a good time to enter.
Gold Chart Pattern
Gold’s price rose almost vertically to pierce the psychological 1600 mark intra-day. I had mentioned about the price consolidation within a rectangle between 1480 and 1550, from which an upward breakout was likely. Accordingly, buying on a breakout above the 1550 level was advised.
Note that gold’s price spurt has been too fast. It has risen far away from its 14 day, 30 day, 60 day, and 200 day SMAs. A pullback towards the 1550 level is a possibility. That may be a better price point to enter.
Silver Chart Pattern
Silver’s price was consolidating within a symmetrical triangle from which an expected downward break did occur. But the 34 level provided good support. The previous low of 32.50 wasn’t tested.
The bulls managed a spirited recovery that took silver’s price above the 14 day, 30 day and 60 day SMAs – as well as the 40 mark. The rise has been a bit steep, and a dip down to 38 is possible. The dip can be a good point to enter.
Till the growth uncertainties in the Eurozone and US economies recede, the precious metals will continue to be safe havens for jittery investors.
