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Gold & Silver; On Cloud Nine Temporarily

 2014 proved 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, lower unemployment and stabilise the so called recovering economy. Damage was done and now with the economy on the mend, consumer demands are expected to pick up. Rise in house prices and strong indication from central bank on a possible interest rate has made those in charge concern about the speed of rising prices. Withdrawing some of that purchasing power is essential before the economy heat faster and start the same spiral of death. 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 the giddy level of cloud nine. The difference this time is that the wound is still fresh and vigilance is paramount.

Gold Technical Outlook
Weekly Chart

With the RSI at 61, there are enough room for the bulls to power through the next set of resistance at $ 1400 and $ 1422 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. Soros laughing as he leave the circus before the sh*t hits the fan. The bear market has reigned over 2013 with 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 high as we enter 2014 but that could change soon.

Resistance: $ 1355, $ 1367.50, $ 1377 Support: $ 1286, $ 1293, $ 1308

Traders Notes: Caught wrong to short the market. Make or break now with $ 1400 in sight.

Short Term (1 - 3 weeks) Medium Term (1 - 3 months) Long Term (6- 12 months)
Bearish $ 1278 Bullish - $ 1387 Target $ 1422

Silver Technical Outlook
Weekly Chart

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 a potential slowdown dampened silver. The break lower was justified and we stick to our view that prices should retraced before advancing higher. 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 long term downtrend line.

Short Term (1 - 3 weeks) Medium Term (1 - 3 months) Long Term (6 - 12 months)
Flat Flat Bullish - a potential bull run?

This article is written according to the author’s views and by no means indicates investment purpose. Opinions expressed at Sharps Pixley Ltd are those of the individual authors and do not necessarily represent the opinion of Sharps Pixley Ltd or its management, shareholders, affiliates and subsidiaries. Sharps Pixley Ltd has not verified the accuracy of any claim or statement made by any independent writer and is reserved as their own and Sharps Pixley Ltd is not accountable for their input. Any opinions, research, analysis, prices or other information contained on this website, by Sharps Pixley Ltd, its employees, partners or contributors, is provided as general market commentary and does not constitute investment advice. Sharps Pixley Ltd will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information. The data contained on this website is not necessarily real-time or accurate. 

14 Mar 2014

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