I am sure I am going to upset a lot of Silver fans but I am not looking to buy silver right now. When it comes to Gold, I believe the upside on that metal is limited too.
As the above video will show you, Silver has been consolidating for a considerable time now. Upward pressure on silver will encounter some heavy resistance. So far Silver has managed to do a 50% retrace of its August-September decline. But it has failed to close above this level and rally to the 61.8% fibonacci level, the next level of resistance. We also need to take out resistance at the 200 moving average at $36.80.
Until Silver has managed to gather momentum and close above the key 61.8% fib level at $37.44, I would not be interested in buying Silver.
Gold enjoyed a nice trending rally after the October squeeze fired off, but now the momentum on that move appears to be diminishing. More interestingly, Gold managed to close above its 61..8% fibonacci level, and it is holding its own around some other key fibonacci clusters (see video): (1) the 100% projection of wave A and (2) the 161.8% extension of wave B.
If Gold does manage to break the 1805 highs and rally higher, it will meet resistance at the 78.6% fibonacci level at around $1840. But if it takes out the November lows, Gold could produce some interesting short opportunities.
Personally, I believe that both Gold and Silver are completing their respective C-Waves as part of the Elliott ABC wave correction. Which in human talk simply means that the upside here is limited. If Gold loses momentum and pushes lower, I would be interested to see it testing its longer term trendline at the $1500 region.
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