Year-end trade got into its flow after two days of regional Bank Holiday closes in Asia, Europe and Canada, ahead of another disjointed New Year week when more Bank Holiday closes will impact order flows. Silver and gold exploded higher in Wednesday trade with moves to test 30.50 and 1410 finding little resistance but also failing to attract increasing participation. The parabolic low-volume moves look destined to reverse to 30.00 and 1400 support unless one of two things happens.
Either the dollar index reverses down through 80.25 support and breaks the sideways channel that it is stuck in which will indicate that the silver and gold moves are sustainable as dollars are switched for metal, or the two precious metals attract 50% more volume to get towards historical daily norms that could allow the breaks to hold. Neither option looks to be happening and therefore the reversal to support looks imminent.
The forex markets have been volatile overnight with reactionary moves hitting as each regional traded market opens and closes, with most currency pairs now stuck at their neutral pivot point areas. The lack of momentum in the near-term as year-end book balancing takes place has created charts that look as though price action could easily break, however the lack of volume will not allow the breaks to easily hold. It may take the fresh momentum of a new year to generate sustainable moves, with history showing that the first quarter of the year tend to be a trending period that negates near-term volatility.
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Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.