This year is proving to be a tricky year as economic leaders try to power through with a significant cut in monetary policy.
The reign has been transitioned from cutting down debt, lowering unemployment and stabilizing the so called recovering economy. Damage was done and now with the economy on the mend, consumer demands are expected to pick up.
After 6 years of the economic recession, economists and banks remain cautious. It was so different compared to the early 2000 as they were previously on cloud nine. The difference this time is that the wound is still fresh and vigilance is paramount.
Gold (COMEX:GCJ14) Technical Outlook
With the RSI at 61, there are enough room for the bulls to power through the next set of resistance at $ 1,400 and $ 1,422 area. Weekly MACD remains positive as it could cross above the neutral zero mark which was last seen in February 2013. Vivid memories as the long pulled out of the market in droves and hedge fund added their short trade. Paulson and Co. faced the prospect of being the victim of his own success. The bear market has reigned over 2013 with a huge ripple across the precious metal market. Meanwhile, stock market acted as the substitute with investors taking a driving seat until the later part of 2013. Stock markets celebrated all-time highs as we enter 2014 but that could change soon.
Resistance: $ 1,355, $ 1,367.50, $ 1,377; Support: $1,286, $ 1,293, $1,308
Traders Notes: Caught wrong to short the market. Make or break now with $ 1,400 in sight.
Short Term (1 – 3 weeks) Bearish $ 1,278; Medium Term (1 – 3 months) Bullish - $ 1,387; Long Term (6- 12 months) Target $ 1,422
Silver (COMEX:SIJ14) Technical Outlook
Silver seems to take a pause and serious second look higher as gold managed to continue its bullish momentum. Pressure from falling copper and other commodities that signal economic growth as well as growing pressure that the world economic power is facing can possibly put a damper on silver. The break lower was justified and we stick to our view that prices should retrace before advancing higher. The main concern only lies on the long term downtrend line that will continue to build pressure.
Resistance: $21.85, $22.20, $ 22.45 Support: $19.50, $20.77, $21.05
Traders Notes: Advance capped by longterm downtrend line.
Short Term: (1 – 3 weeks) Flat; Medium Term (1 – 3 months) Flat; Long Term (6 – 12 months) Bullish—a potential bull run?