We are going to look at the daily chart for the gold and silver markets using a combination of the Variable Changing Price Momentum Indicator (VC PMI) indicators and Fibonacci resistance trend lines and Fibonacci retracements.
Gold: $1268 Target?
Gold last traded at $1207.50, up about $5.90 or $6. The average price was $1204. The market trading above the average price is a bullish indication that the daily trend is bullish and the first target is $1208. The second target for the day is $1215.
If we incorporate the Fibonacci trend line resistance levels, the market has broken through that first level of resistance. The fan-line trend line resistance was broken at about $1200, which the market penetrated that aggressively, going right into the supply zone of the VC PMI to $1208 to $1215. The market then reverted a little back to the average price of $1204, tested that and is resuming the uptrend.
Once we close above the $1215 level, the next target will be around $1230 or $1228/$1229, which is the second level of the Fibonacci trend line resistance. A close above $1229 would activate the third Fibonacci trend line resistance which puts us into the $1263 area, very close to the 50% Fibonacci retracement of $1268.
Silver: $16.10 Target?
The silver market is trading last at $14.7250, up 13.50. The average price is $14.65. The market trading above the average price is bullish, activating the sell 1 (S1) level of $14.74 for the day, which I believe has been completed as I write this report, and activating the sell 2 (S2) target of $14.90.
The Fibonacci trend line resistance levels in silver indicate that a rally all the way up to $15.11 or $15.12. The 23% Fibonacci retracement is roughly at around $14.88/$14.89. Closing above $14.90 would be closing above the VC PMI supply or resistance zones, which would activate the higher targets of the Fibonacci trend line resistance of $15.16. A close above $15.16 would activate the target of $15.61, which is very close to the 50% Fibonacci retracement of $15.85 and extends all the way up to $16.10 as a target using the Fibonacci trend line resistance trend line levels.
The information in the Early Bird Report was obtained from sources believed to be reliable, but we do not guarantee its accuracy. Neither the information nor any opinion expressed herein constitutes a solicitation of the purchase or sale of any futures or options contracts. It is for educational purposes only.
Disclosure: I am/we are long GLD, JNUG GDX.
I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.