All the excitement of gold and silver breaking out to the upside has dissipated with Tuesday’s $25.00 sell off. All those clamouring for the next bull run have been run over once again. Those who traded based on news flow, are wondering what just ran over them.
We stood fast on the technicals maintaining our pricing model which suggested $1,520 was resistance in gold and $18.10 in silver. In one day, both metals broke down to support and are now in danger of breaking down.
The next few days will tell the story for the next big moves in both gold and silver. As we said at the top, we are staying short. However, with the metals now back on support a rally would be no surprise. Our overall view is a breakdown to $1,460-$1,440 level is still in play and we will stay short until proven wrong.
Author: Todd ‘Bubba’ Horwitz
Source: Kitco: Are gold and silver breaking down?