Wednesday, March 12, 2014

gold and silver and the stock market

Here are daily bar continuation charts of gold and silver futures. I think both markets are headed up to targets which lie between the red and green lines on the chart. In each case the red line corresponds to the September 2013 high. In gold the green line is the midpoint between the October 2012 high and the July 2013 low. In silver the green line is the level of the July 2012 low.

The biggest reaction on the way up from the early January low in gold has been $42  and as long as no reaction is much bigger than that (blue rectangles) the up trend will be in good shape. In silver the biggest reaction was $1.70 and as long as reactions on the way up don't exceed that by much the up trend will continue (blue rectangles).

Once the upside targets have been reached I think gold and silver will resume their bear markets. Gold will probably drop close to its 1980 high at $850 while I think silver will reach my long standing target of $13.

The bull market in stocks is still going strong with all three of my trend indicators, the Dow, the S&P 500, and the NYSE advance decline line visibly above their rising 50 day moving averages. As long as two of these three indicators remain above their 50 day moving averages the uptrend from the February 5 low point should continue to move the averages to new bull market highs.

1 comment:

Mag said...

Thanks Carl but $13 is too low for silver. We go to $16 bottom this summer then move back up later in the year.