Tuesday, January 3, 2012

First Gold and Silver Trading Commentary For 2012

February gold closed higher due to short covering on Tuesday as it consolidated some of the decline off September's high. The high range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI are oversold and are turning neutral to bullish signaling that sideways to higher prices are possible near term. Closes above the 20 day moving average crossing at 1632.60 are needed to confirm that a low has been posted. If February extends the decline off November's high, July's low crossing at 1482.60 is the next downside target. First resistance is the 20 day moving average crossing at 1632.60. Second resistance is the reaction high crossing at 1643.70. First support is last Thursday's low crossing at 1523.90. Second support is July's low crossing at 1482.60.

March silver closed higher due to short covering on Tuesday as it consolidated some of the decline off October's high. The high range close set the stage for a steady to higher opening on Wednesday. Stochastics and the RSI are turning bullish signaling that sideways to higher prices are possible near term. Closes above the 20 day moving average crossing at 29.913 are needed to confirm that a short-term low has been posted. If March extends the decline off October's high, the 75% retracement level of the 2010-2011 rally crossing at 25.527 is the next downside target. First resistance is the 20 day moving average crossing at 29.913. Second resistance is the reaction high crossing at 33.300. First support is last Thursday's low crossing at 26.145. Second support is the 75% retracement level of the 2010-2011 rally crossing at 25.527.


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