XAU/USD
Gold broke 4575/4570 to trigger a move to a buying opportunity at 4555/4545.
A bounce from 4530 hit 4582, so there was a potential $30 to $35 on the trade but then Gold collapsed again breaking below 4520.
If you watched my video, the next downside target was 4435/4415 – we made a low for the day at 4445 so we got very close.
Today’s very important support is a little lower at 4415/4400. Longs need stops below 4390.
An unexpected break lower can target 4376/72, perhaps as far as 4363/4359.
I think for the next day or 2 gains are likely to be limited with minor resistance at 4486/92.
Above 4496 allows a recovery to 4503/4513 & we could reverse from here.
A break above 4518 however can target a sell opportunity at 4528/4533. Shorts need stops above 4544.
XAG/USD
Silver climbed initially beating resistance at the 6980/6990 highs for a buy signal targeting 7110/7130.
Longs worked perfectly with a high for the day exactly at 7112. Again, we took the maximum out of this opportunity.
However on the Warsh speech, silver crashed back below 6775/6750 to target a mega buying opportunity at 6655/6640.
I stated: There is a good chance of a low for the day here but longs need stops below 6610.
With a low for the day at 6608 I am happy that this was pretty accurate, especially in such conditions where we had broken the 1 week low.
(The first time we tested 6655/6640 we did manage a quick bounce to 6619 before retesting the level).
I think silver will also remain under pressure in the short term. A break below 6585 could trigger further losses to 6565/6560 & even as far as an excellent buying opportunity at 6490/6460.
This could mark a low for this downside correction but longs need stops below 6410.
If we manage to recover from 6655/6640 on Monday we meet first resistance at 6710/6730.
Shorts need stops above 6770.
