Gold And Silver Update | Why I Am Not Buying Silver

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.


  1. i see where you’re coming from as a trader but as a saver i’m an advocate of phyical gold and silver. Its always better to hold physical gold and silver rather than paper or digital fiat currency. Central banks will continue to print currency. I’m stacking real assets and will buy all the dips. I’m not trolling just think your headline can misconstrue people into thinking its bab to hold these real assets.

    Thanks for the video

  2. @bigpdogg8: If I am not wrong, Alessio is rather bullish on gold and silver on long term… as you are and probably for the same reasons…
    But on a trading point of view, actual analisys of Alessio is bearish, sure this a more or less short term view or at least he precised the levels we have to look at in coming days or weeks to take position.
    So really, no contradiction here.
    I think your post is indeed interesting and I would add that if somebody comes here with the same view as you have (as I have by the way), then for long term or very long term, maybe there is absolutelly no interest to take any risk to wait to buy gold or silver (physical of course) 10% or 20% lower, simply because your goal is to protect your assets… not to trade.

    Thanks Alessio for this update !

  3. Another Professional Trader

    78.6% is’nt a real Fib level – it’s the Square root of another level – although it is usually the last level to hold as support/resistance for a correction – if gold is’nt in a correction it’ll slice right through any fib level – they don’t always curb prices – I can say this some authority as I trade them all the time as my preferred style.
    The guru behind these levels is Robert Miner of Dynamic Traders (I think he deserves credit), he taught Carolyn Boroden, who then taught John Carter and Hubert Senters of whom you’ve most likely learnt the retracements/extensions from.
    If golds heads down then it would be wise to to apply 100-161% fib extension of Wave 1 down, from the top of wave 2 – your ABC description, as Elliott Waves all have fibonacci proportions for each wave – I’d give them more weight than trendlines. But the Elliott wave count so far could just be a simple ABC to the downside! with A & B looking complete
    Alessio, you can’t say for definite this or that will happen in your videos, they’ll be novices watching them, that think there’s some secret way to trade – you need to make it crystal clear to people watching that the odds suggest the upside or downside – never, it will do this or won’t do that, because sometimes it will do as you think and others it won’t.

    Good video though.

  4. $24 Silver, $1450 Gold.. Come to Papa!

  5. Hi Andrew

    Thanks and actually you are right, credit needs to be given to Robert Miner – although I should add I did mention Carolyn Boroden’s website in the video. I like John and Hubert too. I see where you’re going with the ABC counts. I must admit, these elliott wave counts are notorious for causing controversy as many find it subjective. In regards your last point, yes I need to put a disclaimer of some sort somewhere, but come on, it is youtube right? Thanks Andrew. Alessio

  6. Pingback: Gold And Silver Update | Why I Am Not Buying Silver | Leadingtrader … | My Gold Fix

  7. Short short short!! Yes from what i observe is each new high is lower than previous high.

  8. Hi,
    It is a good time to buy the gold and sell the future contract. Right now here in Iran gold coin is 6oo dollars and six month contract is 750 dollars which makes a 25% risk free return. Once gold tanks one can buy the contract back and wait for gold to rise again to sell the future contract again. that way one can make 40% to %50 in six months.
    thanks for you posts

  9. We saw it during the crash of autumn 2008, when for example, gold fell in both USD and GBP, although it soon became a recoil up for the gold as decoupled from the other asset classes, and since then has risen in principle linear. Even the fall of 2008 could see the dollar strengthened, although it is very contradictory when the United States in the days will once again hit the national debt ceiling. Note that in the U.S. are likely fails to deliver lip service to future unspecified cuts at the weekend, which therefore means that you can once again raise the debt ceiling.

    But it’s not a good sign when everything falls. The easiest way to describe it would be deflationary. Interestingly, combined with rising market. The worst of all worlds for example, a mortgage holder.

  10. Thanks Hossein – glad to see Iranians trading futures contracts. Interesting point of view. Alessio

  11. Helene – good argument about Gold. I agree, when risk is being taken off, as happened in 2008, all asset classes were being sold, including gold.

  12. I’ve noticed credit suisse have made deals with mines to prebuy silver at $27 through 2012.
    Silver dropping to to $21 is going to hit them hard.
    I can’t imagine they’re so low on the food chain to make an error like that.
    I’m sure professional traders learn through hard experience these tools work, but to what extent do they become self fulfilling prophecy when everyone is applying them?
    And if the markets are rigged is it possible we are being set up for a fall?

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