We recently penned Gold / Silver Breaking Out Or Just Finding Its Legs? and in the piece pointed to a figure of $1,346 as resistance that should turn to support if there is solid movement above this line. Apparently we were slightly off on this number.
At $1337 per ounce, gold is up $62 over the past week – a nearly 5% gain. Though we suspect short-covering as playing a role in the upside of the past few days, it is difficult to determine with complete certainty to what degree it has been a factor. Another important contributor has been strong institutional buying in response to recession concerns and speculation that the Fed will now move to lower rates before the year is out.
“Directly above here lies the 1357.66 major resistance,” says Karen Jones, an analyst at Commerzbank. “This is the 2014-2019 resistance line. We have a myriad of resistance above here that extend to the 1392.55 2014 high and we think it will take several attempts to clear this major resistance. But longer term we continue to view this as a potential major base pattern, which once complete will target nearer 1690.” Source
Gold is staring that number in the face and could break through any time. As of this writing (1:19pm CST Th 6/6/19) the chart is moving slightly down and posting $1,336.70 after approaching the $1,340 mark. On Wednesday gold actually was sniffing out $1,345 and was severely beaten back to a close of $1,329.80.
As you can see we are circling the area of $1,357 and it will be interesting to see if gold tries to hold on to it’s current move higher or if the banking cartel comes in and beats down by $12 – $15 over the next few hours.
As we noted just yesterday the gold conversation is back in the news full swing. Article after article discussing this weeks movement. Personally, I would rather the word “gold” stay out of the mouths of any the corporate media as every time gold finds its way into their mouths, or coming out of their keyboard, bad things tend to happen.
Silver, on the other hand, has stayed out of the news when it should be the precious metal everyone is talking about. The second largest silver mine in Mexico recently closed – not an insignificant event to the silver world. We suspect there will be more closings, shutterings or projects being put on hold as the year continues to unfold.
Silver, as of this writing (1:29pm CST Th 6/6/19) is holding steady at $14.87. Silver needs to move all the way up to $21.25 range before anything of significance happens. The banking cartel, to this point, has kept silver as far from that point as possible without shutting down all the silver mining operations around the world. The primary silver miners average all-in cost to mine silver is approximately $15 – $16 per ounce and in some cases the cost is north of $20 per ounce. So, you can see silver plotting at this current level is hurting the miners and their operations. We can only hope that someday fundamentals will return to the markets and become the driving force they once were. It used to be that silver responded to manufacturing needs, volume of product in the market, supply vs demand. Those days vanished some years ago as the chart above is now what “silver” looks like. Nothing but squiggly multi-colored lines against a black backdrop. Gold is money, silver should be money and one day silver may be money again. Until then we will keep stacking the shiny and reporting on what’s happening from our front porch.
