Gold and silver fail miserably
For a few days, it appeared that gold and silver had found a bottom. There was hope that the lows were in, and a rally was coming. Once again, they failed to take out the resistance levels and sold off hard from the Tuesday highs.
In fact, Tuesday’s action would be considered a key reversal, signaling much more room to the downside. Gold and silver continued to get hammered this morning. The targets on the downside are 1650 gold and 18 silver.
If the price action continues at the current pace, there could be some acceleration to the downside. We remain short paper metals with no intentions or reversing anytime soon. Obviously, markets can change anytime, but the price suggests the sellers are in control.
Precious metals should be owned on a physical basis with capital that is not needed tomorrow or anytime soon. Trading should be done with paper, knowing that we can trade either side without emotions.
In all markets, price action determines what will happen in the next day, week, or month. Keep the two strategies separate. The worst trade anyone can make is turning a trade into an investment hoping for a way out. Traders must learn to take their losses and move on to the next trade.
Patience, discipline, and money management always win the day. Let the map of the markets show you the way.
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.