My latest tout for silver futures makes for grim reading. However, because Comex Gold’s chart leaves more room for a bullish outcome over the next couple of months, I’ve decided to treat it as a separate case. For in fact, June Gold would become a ‘mechanical’ buy if it pulls back to 1213.60, the green line shown in the chart (see inset). Because the implied entry risk would be about $8400 per contract, however, we’ll want to convert any ‘mechanical’ buying signal that occurs into a ‘camouflage’ entry trigger in order to hold the theoretical entry risk down to a more do-able $40-$80 per contract.
Gold’s price action fits a pattern it has exhibited for well more than a year, rallying no farther than it has to in order to lift bulls from the pit of despair; and then plummeting to exactly the threshold where that despair has returned in full. It certainly does feel like a bear-market tease. However, from a purely technical standpoint, this behavior has created a long-term bullish picture going back to late 2015 with a projected top as high as 1464.90. Keep in mind, though, that that number will remain pie-in-the-sky until such time as the futures push decisively above p=1297.40, a key midpoint Hidden Pivot resistance. We anticipated a stall there to the exact tick, but as always, there was no predicting with confidence at the time how far or for how long this arguably corrective weakness might last. _______ UPDATE (May 8, 7:34 p.m. ET): The futures were barely treading water today and will likely need to fall at least somewhat lower before they can muster a robust bounce. The most bullish spot for this to occur would be from p=1220.20, a midpoint Hidden Pivot support shown here. The rally would then need to surpass the small external peak at 1241.70 before we could breathe a little easier. If the futures pick up little or no support at p, look for more slippage to the 1203.40 target. _______ UPDATE (May 9, 7:06 p.m.): Seller crushed the 1220.20 hidden support so easily that the end-of-day rally must be viewed as suspect. It would need to clear 1241.70 within the next day or two to offer any reason for encouragement. Otherwise, look for more slippage to the 1203.40 target noted above. _______ UPDATE (May 11, 6:33 p.m.): The June contract ended the day on a promising note with a bullish impulse leg that projects most immediately to 1230.10 (click here). A push past the 1226.30 midpoint pivot would all but clinch it. Furthermore, it would take out a few more ‘external’ peaks on the hourly chart, openng a path to still higher prices.
