Technical analysis

Today I want to look at technical analysis of precious metals and other commodities.

Orange picture of graph with text about technical analysis

Technical analysis of Agnico-Eagle Mines, April 30, 2017

This is a weekly chart of Agnico-Eagle:

Weekly chart of Agnico-Eagle Mines (AEM) from the end of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending trend lines are in white

Figure 1. Weekly chart of Agnico-Eagle Mines (AEM) from the end of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending trend lines are in white. Chart: FreeStockCharts.com

The chart sits just at the descending trend line/50-week moving average.

The bullish case

First of all I will argue for the bullish case.

In this scenario prices continue up through the 50-week and the descending trend line.

Because the 50-week moving average is ascending I would give such a scenario a probability of 60 percent.

The bearish case

In this scenario prices are pushed down by the flattening 50-week moving average.

They then also go through the 100-week moving average.

I would give such a scenario a probability of 40 percent.

 

 

Technical analysis of Kinross Gold Corp., April 29, 2017

This is a weekly chart of Kinross:

 Weekly chart of Kinross Gold Corp. (KGC) from the end of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending trend lines are in white

Figure 2. Weekly chart of Kinross Gold Corp. (KGC) from the end of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending trend lines are in white. Chart: FreeStockCharts.com

What is happening in the chart is that it is getting squeezed between trend lines that are working in opposite direction.

We are very soon going to see a resolution as to where the trend is going, but we don’t know yet.

Because technical analysis is all about interpreting the charts, and no additional knowledge can be drawn from politics, I prefer to stick to what the charts are telling me.

The way to go forward is to distinguish between two possible scenarios: the bullish and the bearish.

The bullish case

In the bullish scenario prices are lifted by the 100-week moving average and continue through the 50-week.

Because of the looks of the chart I would only give such a scenario a probability of 20 percent.

The bearish case

In the bearish case prices are going through the ascending trend line as well as the 100-week moving average.

Looking at the chart the feeling that I get is that this is the more probable scenario.

I would therefore give it a probability of 80 percent.

 

 

Technical analysis of crude oil, April 28, 2017

This is what a weekly chart of crude oil looks like:

Weekly chart of the crude oil index (XOIL.X). 50-week moving average is in blue and 100-week is in turquoise. Ascending and descending straight trend line are in white.

Figure 3. Weekly chart of the crude oil index (XOIL.X). 50-week moving average is in blue and 100-week is in turquoise. Ascending and descending straight trend line are in white. Chart: FreeStockCharts.com

My bearish scenario

Because the chart look extremely heavy at the moment (prices sit just at the ascending trend line) I put almost all my money on this.

I would give such a scenario a probability of 95 percent.

My bullish scenario

There’s also a minute possibility that prices will go up from here.

I give such a scenario a probability of 5 percent.

 

Technical analysis of the gold bugs index (HUI), April 27, 2017

This is what a weekly chart of the HUI looks like:

Weekly chart of the Gold Bugs Index (HUI) from the end of 2015 until now. The dotted blue line represents the 50-week moving average and the dotted turquoise the 100-week. Straight ascending and descending trend lines are in white

Figure 4. Weekly chart of the Gold Bugs Index (HUI) from the end of 2015 until now. The dotted blue line represents the 50-week moving average and the dotted turquoise the 100-week. Straight ascending and descending trend lines are in white. Chart: FreeStockCharts.com

The bullish scenario

What is clear from the chart is that prices are stuck between the 50- and the 100-week moving averages.

Because they have hit the ascending trend line it may be that they will now continue up until the descending trend line.

I would give such a scenario a probability of 60 percent.

The bearish scenario

In the bearish scenario prices are plunging through the ascending trend line/100-week moving average.

I give such a scenario a probability of 40 percent.

The reason why I give it such a high probability is because of the lower high in February compared to last autumn.

 

 

Technical analysis of gold, April 24, 2017

This is what a weekly gold chart looks like:

Weekly chart of the World Gold Index from the end of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending straight trend lines are in white

Figure 5. Weekly chart of the World Gold Index from the end of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending straight trend lines are in white. Chart: FreeStockCharts.com

What is clear from the chart is that prices are struggling to penetrate the descending trend line.

They also seem to be squeezed between the rising 50-week moving average and the trend line.

Once this situation resolves itself we will know a bit more about the direction of the chart.

The bullish scenario

In this scenario prices go through the 50-week and then continue up.

I would give such a scenario a probability of 50 percent.

The bearish scenario

In this scenario prices are pressed down by the descending trend line.

I would also give such a scenario a 50 percent probability.

 

 

Technical analysis of Randgold Corp., April 23, 2017

This is what a weekly chart looks like:

Weekly chart of Randgold Corp. (GOLD) from the end of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending trend lines are in white.

Figure 6. Weekly chart of Randgold Corp. (GOLD) from the end of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending trend lines are in white. Chart: FreeStockCharts.com

What we see in the chart is that prices are slowly being squeezed and pushed down by the 50-week moving average.

My bearish scenario

In the bearish scenario prices not only go down below the 100-week moving average but also plunge through the rising trend line.

While this scenario is obviously possible I would only give such a scenario a probability of 10 percent.

The reason for this is that support from the rising moving average/trend line is likely to be significant.

My bearish/bullish scenario

The bearish/bullish scenario is very similar to the bearish scenario above.

The difference is that prices bounce off the ascending trend line.

I would the scenario a probability of 40 percent.

My bullish scenario

In this scenario prices penetrate through the 50-week moving average and continue up from there.

I give such a scenario a probability of 50 percent.

 

Technical analysis of Silver Wheaton, April 22, 2017

Today I will look at Silver Wheaton. This is what a weekly chart looks like:

Weekly chart of Silver Wheaton (SLW) from the end of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending trend lines are in white.

Figure 6. Weekly chart of Silver Wheaton (SLW) from the end of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending trend lines are in white. Chart: FreeStockCharts.com

What is obvious in the chart is that we have two opposing trend lines: One ascending and the other descending.

One of them will win but at this point it is not entirely clear which scenario will do it.

My bearish scenario

In this scenario prices continue down from here and also plunge through the 100-week moving average.

Because of the rising trend line below I would give such a scenario a low probability of 10 percent.

My bearish/bullish scenario

This scenario is very similar to the one above but when prices come down to the rising trend line they bounce up.

I would give such a scenario a probability of 40 percent.

My bullish scenario

We can also argue for the bullish case. In this scenario prices go up from here and go through the descending trend line and 50-week moving average.

I would give such a scenario a probability of 20 percent.

My bullish/bearish scenario

This scenario is very similar to the bullish scenario above with the difference that prices are pushed down by the descending trend line.

I would give it a probability of 30 percent.

Conclusion:

That something will happen soon is clear from the chart, but the direction of this move is still uncertain.

 

 

 

Technical analysis of crude oil, April 21, 2017

This is what a weekly chart of crude oil looks like:

Weekly chart of the crude oil index (XOIL.X) from the end of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending trend lines are in white

Figure 4. Weekly chart of the crude oil index (XOIL.X) from the end of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending trend lines are in white. Chart: FreeStockCharts.com

My bearish scenario

In this scenario prices are being pressed down by the descending trend line and go through the moving averages in Figure 1.

At this point I would give such a scenario a probability of 70 percent.

My bearish/bullish scenario

This scenario is very similar to the one above. Here prices continue down, but then change direction at the 50-week moving average.

I would give such a scenario probability of 20 percent.

My bullish scenario

Of course I can also argue for a bullish case. Here prices shoot straight up without being hindered by the descending trend line.

I would only give such a scenario a probability of 10 percent.

Technical analysis of the Gold Bugs Index, April 20, 2017

A weekly chart of the HUI Index looks like this:

Weekly chart of the HUI Index from the beginning of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending trend lines are in white.

Figure 5. Weekly chart of the HUI Index from the beginning of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending trend lines are in white. Chart: FreeStockCharts.com

The bearish scenario

In the bearish scenario prices are pushed down by the 50-week moving average and they then plunge through the 100-week.

At this juncture that is a plausible scenario that I would give a probability of 30 percent.

The bullish scenario

In the bullish scenario prices first go through the 50-week moving average and then the descending trend line.

The lower high in February makes this slightly less probable than the scenario above.

I would give such a scenario a probability of 20 percent.

The bearish/bullish scenario

This scenario is very similar to the bearish scenario above, but with the difference that prices bounce of the ascending trend line below.

I would give such a scenario a probability of 50 percent.

Technical analysis of platinum, April 19, 2017

Weekly chart of the World Platinum Index from the beginning of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Straight trend lines showing ascending and descending trend lines are in white.

Figure 6. Weekly chart of the World Platinum Index from the beginning of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Straight trend lines showing ascending and descending trend lines are in white. Chart: FreeStockCharts.com

My bearish scenario

In this scenario prices are pressed down by the 100-week moving average and they also plunge through the ascending trend line.

Given how much the platinum prices have struggled recently, I would give such a scenario a fairly high probability of 40 percent.

My bullish scenario

In the bullish scenario go up through the moving averages in Figure 1 and continue through the descending trend line.

Given the shape of the graph I would give such s scenario a probability of 10 percent.

My bearish/bullish scenario

In the bearish/bullish scenario prices first go down as in the bearish scenario above, but then bounce up.

I would give such a scenario a probability of 50 percent.

 

Technical analysis of silver, April 18, 2017

As usual I look at weekly charts to draw my conclusions:

Weekly chart of the World Silver Index from the end of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending straight trend lines are in white.

Figure 7. Weekly chart of the World Silver Index from the end of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending straight trend lines are in white. Chart: FreeStockCharts.com

The bullish scenario

The bullish scenario is based around the idea that there is no descending trend line in the chart.

In this scenario prices can move straight through without experiencing “gravity”.

In essence prices are lifted by the 50-week moving average.

I would give such a scenario a low probability because of the lower high in February and now.

The descending trend line simply makes the situation difficult for higher prices.

My probability ends at 20 percent.

The bearish scenario

The bearish scenario is based around the idea that there is no ascending trend line in the chart.

In this scenario prices will fall through the moving averages as well as the ascending trend line.

I would give such a scenario a probability of 20 percent.

The bearish/bullish scenario

Here prices fall down until they reach the ascending trend line below.

This is the most likely scenario for the time being.

I would give it a probability of 60 percent.

Technical analysis of gold, April 17, 2017

This is what a weekly gold chart looks like:

Weekly chart of the World Gold Index from the end of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending straight trend lines are in white.

Figure 8. Weekly chart of the World Gold Index from the end of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending straight trend lines are in white. Chart: FreeStockCharts.com

The bullish scenario

We are now at an interesting juncture just at the descending trend line.

It is possible that prices will continue up, but because of the descending trend line I give such a scenario a low probability: 25 percent.

The bearish scenario

On the other hand there is a distinct possibility that prices will go down from here and through both the 50-week and the 100-week moving averages as well as the ascending trend line.

I would give such a scenario a probability of 25 percent.

The bearish/bullish scenario

In this scenario prices go down just like above, but then bounce up at the ascending trend line.

I would give such a scenario a probability of 50 percent.

 

 

Technical analysis of IAMGOLD Corp., April 16, 2017

A weekly chart of IAMGOLD looks like this:

Weekly chart of IAMGOLD. The 50-week moving average is represented in blue and the 100-week in turquoise. Descending and ascending straight trend lines are also in white

Figure 6. Weekly chart of IAMGOLD. The 50-week moving average is represented in blue and the 100-week in turquoise. Descending and ascending straight trend lines are also in white. Chart: FreeStockCharts

My bullish scenario

The bullish scenario revolves around prices being lifted by the rising 50-week moving average and going through the descending trend line.

This is a plausible scenario, but I don’t give it too high a probability because the high in January is lower than the high in August.

I would give it a probability of 20 percent.

My bearish scenario

In the bearish scenario prices are falling down below both the ascending trend line and the 100-week moving average.

Of course this can happen but it is not very likely. I give it a probability of 5 percent.

My bullish/bearish scenario

In this scenario prices are going up until they hit the descending trend line where they struggle and eventually turn south.

I would give such a scenario a probability of 65 percent.

My bearish/bullish scenario

In the bearish/bullish scenario prices are first falling down, but are then caught by either the ascending trend line or the 100-week moving average.

I would give such a scenario a probability of 10 percent.

Technical analysis of Yamana Gold Inc., April 15, 2017

As usual I look at weekly charts:

Weekly chart of Yamana Gold. The 50-week moving average is represented in blue and the 100-week in white. Descending and ascending straight trend lines are also in white.

Figure 7. Weekly chart of Yamana Gold. The 50-week moving average is represented in blue and the 100-week in white. Descending and ascending straight trend lines are also in white. Chart: FreeStockCharts

The bullish case

In the bullish case prices go through the combined 100-week moving average/the descending trend line and then also through the declining 50-week moving average.

Because of the lower low earlier this year I give such a scenario a low probability: 20 percent.

The bearish case

In the bearish case prices are pushed down by the 100-week moving average and then through the support zone that is drawn in the figure.

I would give such scenario a probability of 60 percent.

The bearish/bullish case

In the bearish/bullish case prices are going down just like in the bearish case but then when they reach the support zone in Figure 1 the are reversed.

I would give such a scenario a probability of 20 percent.

 

Technical analysis of Tesla Inc., April 14, 2017

This is a weekly chart of Tesla Inc.:

Weekly chart of the HUI Index from the beginning of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Horizontal trend lines are in white.

Figure 8. Weekly chart of the HUI Index from the beginning of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Horizontal trend lines are in white. Chart: FreeStockCharts.com

What is clear from the chart is that we have been trading in a channel for more than two years.

Now it seems as though we have been breaking out from that channel and are off to greener pastures.

I would like to caution you, however, that prices can fall down from here.

In order to look at exactly when to get in I will now turn to a daily chart:

 Daily chart of the HUI Index from the summer of 2016 until now. 50-day moving average in blue and 100-day moving average in turquoise. Horizontal trend lines are in white.

Figure 9. Daily chart of Tesla Inc. from the summer of 2016 until now. 50-day moving average in blue and 100-day moving average in turquoise. Horizontal trend lines are in white. Chart: FreeStockCharts.com

What we see in the chart is that prices are clearly above the 50-day moving average.

In my experience, that is not the time to get in. It is better to wait until prices have come down and kissed to 50-day.

Conclusion:

The chart pattern of Tesla is bullish, but because prices are so far above the 50-day moving average I would wait until they come in.

 

Technical analysis of the Gold Bugs Index, April 13, 2017

As usual on Thursdays today I will look at the Gold Bugs Index. This is what a weekly chart looks like:

Weekly chart of the HUI Index from the beginning of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending trend lines are in white.

Figure 9. Weekly chart of the HUI Index from the beginning of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending trend lines are in white. Chart: FreeStockCharts.com

The bullish scenario

In the bullish scenario prices go up and penetrate both the 50-week moving average and the descending trend line.

Because prices in February were lower than prices were in August (lower high) I would give such a scenario a low probability: 10 percent.

The bullish/bearish scenario

In the bullish/bearish scenario prices first go up but then stop at 50-week moving average or the descending trend line.

Once they’ve reached either of these they will then head south.

I would give such a scenario a higher probability of 60 percent.

The bearish/bullish scenario

In this scenario prices are first going down until they reach the ascending trend line.

Once prices have reached the ascending trend line they bounce and continue up.

I would give such a scenario a probability of 20 percent.

The bearish scenario

In this scenario prices go down and fall straight through both the 100-week moving average and the ascending trend line.

I would give such a scenario a probability of 10 percent.

Technical analysis of platinum, April 12, 2017

Today I would like to look at a weekly chart of platinum:

Weekly chart of the World Platinum Index from the beginning of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Straight trend lines showing a potential head and shoulders-pattern are in white.

Figure 10. Weekly chart of the World Platinum Index from the beginning of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Straight trend lines showing a potential head and shoulders-pattern are in white. Chart: FreeStockCharts.com

My bearish scenario

In the bearish scenario prices are pushed down by the 100-week moving average where they continue through the ascending trend line.

I would give such a scenario a probability of 40 percent.

My bearish/bullish scenario

In the bearish/bullish scenario prices go down to the ascending trend line as above, but then they bounce up.

I would give such a scenario a probability of 40 percent.

My bullish scenario

In the bullish scenario prices penetrate through the 100-week moving average as well as the 50-week. Prices then continue up and through the descending trend line.

I would give such a scenario a probability of 20 percent.

 

Technical analysis of silver, April 11, 2017

Today I will try a different explanation for what is happening in the precious metals. This is what a weekly silver chart looks like:

Weekly chart of the World Silver Index from the beginning of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Straight trend lines showing a potential head and shoulders-pattern are in white.

Figure 9. Weekly chart of the World Silver Index from the beginning of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Straight trend lines showing a potential head and shoulders-pattern are in white. Chart: FreeStockCharts.com

My bearish scenario:

I’m now trying an alternative explanation for the silver (and gold) chart.

In this scenario there is a left shoulder, there is a head and there is a right shoulder.

If this is to play out we will soon see prices go from $18 down to $16.

I would give such a scenario a probability of 40 percent.

My bullish scenario

In the bullish scenario prices are lifted by the 50-week moving average that will act as support.

I would give such a scenario a probability of 20 percent.

My bearish/bullish scenario

In this scenario prices are first falling down to the 100-week moving average.

Here they bounce up again, lifted by the 100-week.

I would give such a scenario a probability of 20 percent.

Technical analysis of gold, April 10, 2017

This is what a weekly chart of gold looks like:

Weekly chart of Goldcorp from the beginning of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending straight trend lines are in white.

Figure 10. Weekly chart of the World Gold Index from the beginning of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending straight trend lines are in white. Chart: FreeStockCharts.com

My bearish/bullish scenario

In this senario prices are facing resistance at the 50-week moving average and they are subsequently heading down.

What happens when prices meet the ascending trend line is anybody’s guess but in this scenario they head up again.

I would give such a scenario a probability of 50 percent.

My bearish scenario

In this scenario prices don’t find support down at the ascending trend line, but rather continue down.

I would give such a scenario a probability of 40 percent.

My bullish scenario

This is where prices go up from here.

I would give such a scenario a probability of 10 percent.

 

Technical analysis of Goldcorp, April 9, 2017

As always I prefer to look at weekly charts and this is what such a chart looks like for Goldcorp:

Weekly chart of Goldcorp from the beginning of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending straight trend lines are in white.

Figure 9. Weekly chart of Goldcorp from the beginning of 2015 until now. 50-week moving average in blue and 100-week moving average in turquoise. Ascending and descending straight trend lines are in white. Chart: FreeStockCharts.com

The bearish/bullish scenario

What we see in the chart is that prices are getting squeezed between the ascending and descending trend lines.

Now they are getting pushed down by the moving averages.

That can be seen two weeks ago when prices tried and failed to go through the 50-week moving average.

Chances are that prices will go down even further, but then bounce up again down at the ascending trend line.

I would give such a scenario a probability of 60 percent.

The bullish scenario

Of course I can also argue for the bullish case, and in this scenario prices go up from here as they are being lifted by the 100-week moving average.

I would give such scenario a probability of 10 percent.

The bearish/bearish scenario

The bearish/bearish scenario is indistinguishable from the bearish/bullish scenario until prices reach the lower, ascending, trend line.

Here they go straight through.

I would give such a scenario a 20 percent probability.

 

Technical analysis of Newmont Mining, April 8, 2017

This is a weekly chart of Newmont Mining:

Weekly chart of Agnico-Eagle Mines since 2013 until present. The 50-week moving average is represented in blue and the 100-week in turquoise. Straight ascending trend lines are in white.

Figure 5. Weekly chart of Agnico-Eagle Mines since 2013 until present. The 50-week moving average is represented in blue and the 100-week in turquoise. Straight ascending trend lines are in white. Chart: FreeStockCharts

The bullish scenario

From the chart it is obvious that a new fault line has opened up at the lower trend line.

The bulls are pulling prices higher with rising moving averages and trend line.

The probability of prices going higher from here is therefore 30 percent.

The bullish/bearish scenario

In the bullish/bearish scenario prices continue up as in the upper scenario, but then they halt at the descending trend line.

In favor of this is the fact that prices are lower now than they were in September.

I would give such a scenario a probability of 60 percent.

The bearish scenario

In the bearish scenario prices are falling down from here.

They go through both the trend line and the rising 100-week moving average.

I would give such a scenario a probability of 10 percent.

 

Technical analysis of crude oil, April 7, 2017

This is what a weekly chart looks like:

Weekly chart of the Light Sweet Crude Oil Index from mid-2013 until present. The 50-week moving average is represented in blue and 100-week in turquoise. Straight ascending and descending trend lines are also in white.

Figure 6. Weekly chart of the Light Sweet Crude Oil Index from mid-2013 until present. The 50-week moving average is represented in blue and 100-week in turquoise. Straight ascending and descending trend lines are also in white. Chart: FreeStockCharts

My bullish/bearish scenario

In the bullish/bearish scenario prices go up the descending trend line where they stall and head south.

The reason that I believe in this is that prices have tried to break through the trend line before without succeeding.

I would give such a scenario a probability of 70 percent.

My bullish scenario

In the bullish scenario prices not only go up, but also pass the descending trend line.

In analogy to the scenario above, I would give such a scenario a probability of 10 percent.

My bearish scenario

In the bearish scenario prices lose steam and fall down from here.

I don’t really believe that this will happen but I give such a scenario a probability of 20 percent.

 

Technical analysis of The Gold Bugs Index, April 6, 2017

This is what a weekly chart of the Gold Bugs Index looks like:

Weekly chart of the Gold Bugs Index from 2014 until now. 50-week moving average is in blue and 100-week in turquoise. Straight ascending and descending trend lines are in white.

Figure 7. Weekly chart of the Gold Bugs Index from 2014 until now. 50-week moving average is in blue and 100-week in turquoise. Straight ascending and descending trend lines are in white. Chart: FreeStockCharts

The bullish/bearish scenario

In this scenario prices are first going up until they reach the 50-week moving average.

Because prices fail to move through the 50-week moving average they are instead pressed down.

The reason why I believe in this is that the high made in February is lower than the high in September. This kind of chart pattern usually is bearish.

I would give such a scenario a probability of 70 percent.

The bearish/bullish scenario

In the bearish/bullish scenario prices are moving down to the 100-week moving average and the ascending trend line when they are lifted.

Prices would then move through the 50-week moving average as well as through descending trend line.

In analogy to the scenario above I would give this a lower probability of 10 percent.

The bearish/bullish/bearish scenario

In this scenario instead going through the 50-week moving average and the trend line prices are changing direction on one of those.

This, in my opinion, seems slightly more likely than the scenario above.

I would therefore give such a scenario a probability of 20 percent.

 

Technical analysis of platinum, April 5, 2017

If you are a regular reader of this blog you know that I prefer to look at weekly charts:

Chart of the World Platinum Index from mid-2014 until now. The time frame is weekly. The 50-week moving average is in blue and the 100-week moving average is in turquoise. Ascending and descending trend lines are drawn in white.

Figure 8. Chart of the World Platinum Index from mid-2014 until now. The time frame is weekly. The 50-week moving average is in blue and the 100-week moving average is in turquoise. Ascending and descending trend lines are drawn in white. Chart: FreeStockCharts

My bearish scenario

In the bearish scenario prices are pushed down by the declining 100-week moving average.

In favor of this argument is the fact the high in February was lower than September last year.

Another negative thing for the chart is that prices now are below the moving averages and are not likely to rise in the near future.

This is my preferred scenario looking at the chart and I would give it a probability of 80 percent.

My bullish scenario

In the bullish scenario prices are pushed up by the rising trend line in the chart.

In favor of this is the fact that the trend line is indeed rising and that they will follow along.

The probability for happening is low at 20 percent.

 

Technical analysis of silver, Tuesday, April 4, 2017

This is what a weekly silver chart looks like:

Weekly chart of the World Silver Index from 2013 until present. 50-week moving average is represented in blue and 100-week moving average is in turquoise. Arbitrary ascending and descending trend lines are in white

Figure 9. Weekly chart of the World Silver Index from 2013 until present. 50-week moving average is represented in blue and 100-week moving average is in turquoise. Arbitrary ascending and descending trend lines are in white. Chart: FreeStockCharts

My bullish scenario

In the bullish scenario prices are lifted by the combined forces of the moving averages and the rising trend line.

I would give such a scenario a 80 percent probability.

My bearish scenario

InĀ  the bearish scenario prices fall down from here.

There is one little thing in the graph that is in favor of this scenario and that is that the high made in February of this year was lower than the high last autumn.

It doesn’t guarantee a bearish outcome of the chart.

I would give such a scenario a probability of 20 percent.

 

Technical analysis of gold, Monday, April 3, 2017

As always I will look at a weekly gold chart to figure out what is going to happen.

This is what it looks like:

My bearish scenario

What happened last week was that prices stalled at the 50-week moving average.

Because the moving average is acting as resistance for prices my main scenario will be bearish.

Such a scenario would get a probability of 60 percent.

My bullish scenario

Of course it is also possible that prices continue up through the 50-week moving average and the descending trend line.

I would give such a scenario a probability of 30 percent.

My neither bullish nor bearish scenario

There is also a possibility – however low – that prices will continue straight along the 50-week moving average.

I would give such a scenario a probability of 10 percent.

 

Technical analysis of Agnico-Eagle, April 2, 2017

This is what a weekly chart of Agnico-Eagle looks like:

The bullish scenario

What happened last week was that prices changed direction again. This time they went from going up to going down.

In the bullish scenario prices will continue up from here and pass through the 50-week moving average and the descending trend line.

I would give such a scenario a probability of 20 percent.

The bullish/bearish scenario

In this scenario prices go up to either the descending trend line or the 50-week moving average and then they turn down.

The probability of this scenario is 30 percent.

The bearish scenario

In the bearish scenario prices continue down from here and go straight through the ascending trend line and the 100-week moving average.

I would give such a scenario a probability of 20 percent.

The bearish/bullish scenario

In this scenario prices continue down to either the ascending trend line or the rising 100-week moving average and then follow these up.

This scenario gets a probability of 30 percent.

Kinross Gold Corp., April 1, 2017

Today I would like to revisit Kinross Gold Corp. that we looked at about a month ago.

This is what a weekly chart looks like:

My bullish scenario

It looks as though prices are being lifted by the combined forces of the 100-week moving average and the rising trend line.

In the bullish scenario prices continue up through the declining trend line and they will not run into resistance at the 50-week moving average either.

I would give such a scenario a probability of 35 percent

My bearish scenario

In the bearish scenario prices break down from here and pass through both the 100-week moving average and the ascending trend line.

While this is not impossible by any means I do think there is enough strength in the support to keep prices up at least for the time being.

I would therefore give such a scenario a probability of 15 percent

My bullish/bearish scenario

The bullish/bearish scenario is where prices go up slowly until they encounter the resistance zone at the declining trend line.

It may even be that prices go through the descending trend line, but then there is resistance also at the 50-week moving average.

Therefore prices are likely to halt at either of these.

I would give such a scenario a probability of 50 percent.

 

Technical analysis of crude oil, March 31, 2017

This is what a weekly chart of The Light Sweet Crude Index looks like:

My bullish/bearish scenario

This week we have seen a big reversal in the chart.

A few weeks ago I thought that the chart would break down, but it has not happened.

Instead prices were caught by the 100-week moving average and is now moving up again.

Therefore, I would give this scenario a probability of 70 percent.

My bullish scenario

In my bullish scenario the upper trend line is not in play so prices continue through it without any problems.

This seems unlikely because prices have tried and failed to this for about three months before.

Therefore I would give such a scenario a probability of 5 percent.

My bearish scenario

Of course prices can also break down from here.

Even if it seems improbable at this point I would still give such a scenario a probability of 20 percent.

Technical analysis of The Gold Bugs Index, March 30, 2017

A weekly chart of the gold bugs index – the HUI – looks like this:

What is clear from the chart is that is that prices changed direction three weeks ago, but are now running out of steam.

They are stuck between the 100-week moving average and the 50-week. They need to decide if they are going to go up or if they are going to go down.

My bullish/bearish scenario

In this scenario prices to go up to the 50-week moving, but after that they go down.

They will then move down through the ascending trend line and go further down from there.

I would give such a scenario a probability of 30 percent.

The reason why it is not getting higher odds is because the high in February was lower than the high in August.

My bullish scenario

Here prices go up through the 50-week moving average and continue up to the declining trend line.

What it will do up there is unclear at the moment, but my guess is that prices will stall and turn negative.

I would give such a scenario a 20 percent probability.

My bearish scenario

In this scenario prices fall down from here.

The chart in my eyes looks heavy and the reason for this is probably because of the lower high mentioned above.

The probability for this happening ends up at 50 percent.

 

Technical analysis of platinum, March 29, 2017

As always I prefer weekly charts and this is what the weekly platinum chart looks like:

My bearish scenario

From the chart it is clear that the 100-week moving is acting as resistance to the price that has been trying to push through.

Because the moving average is declining I don’t expect prices to go through the moving average.

The probability for prices going down to the ascending trend line is therefore high. It comes in at 70 percent.

My bullish/bearish scenario

The bullish/bearish scenario is that prices continue through both the 100-week and the 50-week moving average above.

If prices then finally encounter the descending trend line they will be pushed down by this.

I don’t find it very likely, because prices are clearly being pushed down by the declining 100-week moving average.

The probability for this happening end up somewhere around 15 percent.

My bullish scenario

In the bullish scenario prices go through the moving averages in figure 1 and then also continue through the descending white trend line.

As above, this is not a very likely, but I would still give it a probability of 15 percent.

 

Technical analysis of gold, March 27, 2017

If you are a regular reader of this blog you know that I prefer to look at weekly charts in order to draw my conclusions.

This is what a weekly chart looks like:

My bullish/bearish scenario:

Last week was another positive week for gold. It now seems that we are stuck between the 50-week moving average and the 100-week moving average.

What I believe will happen is that prices will press through the 50-week moving average this week and then press up against the descending trend line.

In the bullish/bearish scenario prices go down when they encounter the descending trend line.

I would give this scenario a 70 percent probability.

My bullish scenario

In the bullish scenario the descending trend line is not in play and the prices continue up.

I don’t give that scenario as high a probability as the bullish/bearish scenario because the high in February was lower than the high in August.

I still give it a 29 percent probability.

My bearish scenario

In the bearish scenario prices fall down from here without anything stopping it.

Of course it can happen, but it seems unlikely.

I would give such a scenario a 1 percent probability.

Randgold Resources, March 25, 2017

Today I want to look at Randgold Resources.

It is a South African mining company with an interesting long-time-chart:

My bullish scenario

What is clear in the graph is that prices had a huge run-up until the high set in 2012.

However, they did not manage to break through and fell sharply thereafter.

We can easily identify an ascending trend line beginning in 2015 with another bottom in 2016, but prices are now stuck between the 100-week moving average and the 50-week MA.

What I believe will happen is that prices will continue up on its current trend line.

I would put the probability of this happening at 80 percent.

My bearish scenario

The bearish scenario would play out if neither the ascending trend line nor the 100-week moving average would act as support for prices.

I would give such a scenario a 19 percent probability.

 

Technical analysis of crude oil, March 24, 2017

A weekly chart of the World Crude Index looks like this:

My bearish scenario

My bearish scenario plays out if prices are pushed down from here through the combined ascending trend line and the 100-week moving average.

Because prices have tried – and failed – to push through the resistance zone represented by the descending trend line, I believe that this scenario is likely to play out.

I would give it a probability of 70 percent.

My bullish scenario

The bullish scenario will play out if prices move up from here.

In favor of this scenario is that prices are now just sitting at the rising trend line.

Another positive thing for this scenario is prices have been rising since 2016.

But the fact that they have tried and failed to break through gives this a low probability.

I would give it a probability of 29 percent.

 

Technical analysis of the gold bugs index, March 23, 2017

This is what a weekly chart of the HUI looks like:

My bullish/bearish scenario

What is clear from the chart is that prices changed direction last week.

It does seem like the thrust upwards is losing a little bit of its energy, but I do believe that prices will continue up to the 50-week moving average from here.

Then I believe that prices will fail and turn down again.

The probability for this scenario is 60 percent.

My bullish scenario

The positive scenario would be if none of resistance in the graph was in play. Then prices would continue up to the sky without anything stopping them.

I would only put a 9 percent probability on this scenario.

My bearish scenario

The negative scenario would be for prices simply to fall down from here.

An argument against this is that the ascending trend line is likely to lift the prices when they encounter it.

I would still give this scenario a 30 percent probability.

 

Technical analysis of platinum, March 22, 2017

This is what a weekly chart of platinum looks like:

My negative scenario

At this point my preferred scenario is the negative one.

In this scenario the descending 100-week moving average is going to catch the price movement and push it down.

I would put a 60 percent probability on this happening.

My positive/negative scenario

In this scenario the declining 100-week moving average is not in play, and prices continue up to the descending white trend line in Figure 1.

My guess is that the trend line is then acting as resistance for the chart and that it will force prices down towards the rising trend line below.

I would put a 30 percent probability on this happening.

My positive scenario

The positive scenario would be if none of the things indicating resistance in the graph was in play.

Then prices would shoot straight up without any hindrance.

The reason why I don’t believe in this is because the high reached three weeks ago is lower than the high in August.

The probability for this happening I would put at 9 percent.

 

Technical analysis of silver, March 21, 2017

This is what a weekly chart of silver looks like:

The positive/negative scenario

What is clear from the graph is that prices have been moving in zigzag for the past year or so.

If we are not that accurate we can say that prices changed direction again last week at the 100-week moving average.

In a few weeks, I believe that the 50-week moving average and the descending trend line will prove too tough on prices.

The reason for me saying so is that the high we had a few weeks ago was lower than the high we set in August of last year.

After that my prediction is that prices will go down.

That is why I put a probability of 70 percent on this scenario.

The positive scenario

This scenario is based on the idea that the descending trend line and the 50-week moving average will not be in play.

I would give such an event a 20 percent probability.

The negative scenario

Of course it is also possible that prices fall from here and that they will not be caught by any price support.

However, I do consider this as an unlikely scenario and I would give it a probability of 9 percent.

Conclusion:

Today I’ve been doing technical analysis of silver again.

Because prices have changed direction once again I believe that they will continue up and kiss the declining trend line.

What happens after that is unclear in my opinion. We will have to wait and see.

 

Technical analysis of gold, March 20, 2017

I prefer to look at a weekly chart to draw my conclusions. This is what it looks like:

The negative/positive scenario

What is clear from the chart is that prices changed direction again last week.

What I believe will happen is that prices will continue up but that they will stop at the descending trend line and turn down again.

I would put the probability for this happening at 70 percent.

The positive scenario

Of course it’s possible that prices will not face resistance at the declining trend line.

But that fails to include that we have a lower high this year than the one achieved last year.

That is why I put the probability for this scenario at 20 percent.

The negative scenario

Another possibility is that prices tumble from here.

Of course that can happen, but I don’t consider it very likely.

I would put a 9 percent probability on this scenario.

 

IAMGOLD Corp., March 19, 2017

A weekly chart of IAMGOLD looks like this:

The positive/negative scenario

What is clear from the chart is that it looks very much the same as the other gold mining charts.

Prices were dropping until the beginning of 2016 only to change direction completly and rose almost vertically.

Then they dropped again until they kissed the 50-week moving average.

After another rise prices last week came down and touched the 100-week moving average.

Because the moving average is rising I believe that prices will continue up until they kiss the descending trend line that is drawn in the figure.

Thereafter I believe prices will go down again.

The probability for this happening would be 70 percent.

The positive scenario

Of course there’s also a positive scenario where the descending trend line is not in play. I don’t really believe in this, but I would still give it a 20 percent probability.

The negative scenario

The negative scenario would be that prices fell down from here and that they did not get caught by the ascending trend line. I regard this as unlikely and give it a probability of 9 percent.

Yamana Gold, March 18, 2017

Today I would like to look at Yamana Gold.

As always I prefer to look at a weekly chart to draw my conclusions:

My negative scenario

What is clear from the chart is that the prices are below both the 50-week and the 100-week moving average.

What is also obvious is that the high that came in earlier this year is lower than the high last year.

This is a bearish sign.

Furthermore, there is a declining trend line that’s in play too.

So even if go up to the declining trend line/100-week moving average I don’t see it go through.

My main scenario is therefore that will go up a little bit for the next two weeks, but that they then will fail and go below the lower, ascending, trend line.

The probability for this playing out I would put at 80 percent.

My positive scenario

Of course it’s always possible that prices will continue up through the declining trend line, but to me the chart looks “heavy” and I put this probability at 19 percent.

 

Technical analysis of crude oil, March 17, 2017

As usual I prefer to look at weekly chart to draw my conclusions. This is what such a chart looks like:

What we can see in the chart is that the prices headed south last week, but that they were caught this week and are slightly up.

Remember last week I was talking about prices falling, and if you look at the trend line that I had drawn, that would likely be the case.

What I didn’t consider was a different trend line that took into account the 50-week moving average.

I still believe that prices will fall because prices are pressing against the moving average, but technically I cannot tell in which direction will go.

All I can say is that the move will be violent.

If we look at the inventories it is clear that they are at the highest that they have been for a long time.

That is why my main scenario is that prices will fall.

My positive scenario

Of course it is possible for prices to continue up from here, but I don’t consider that eventuality to be very likely.

 

Technical analysis of the Gold Bugs Index, Thursday, March 16, 2017

As always I prefer to look at weekly charts to draw conclusions. This is what it looks like:

Positive scenario

What we see in the chart is that prices changed direction this week.

The most probable outcome is then for prices to continue up instead of falling down.

One thing that is in favor of this argument is that both the 100-week moving average and the rising trend line are ascending.

The probability for this happening I would put at 80 percent.

Negative scenario

Of course I can also make an argument for lower prices where they would fall below the ascending trend line.

The probability for this happening remains low however.

If I were to put odds on this scenario I would say that the probability for this happening is 19 percent.

Conclusion:

Today I’ve been doing technical analysis of the gold bugs index (HUI).

Because prices changed direction this week, and because the 100-week moving average is ascending, the likely outcome is higher prices.

 

Technical analysis of Silver, Tuesday, March 14, 2017

This is what a weekly chart looks like:

What we can see in the chart is that last week we had a big down week and that the 50-week moving average was not able to support the prices.

What we also can see in the chart is that in December of last year prices went through the 100-week moving average.

They subsequently stopped at the rising trend line that is drawn in the chart.

This is why I don’t think that the chart will stop at the 100-week moving average but rather continue down and touch the rising trend line.

Then I believe that prices will bounce up, but I’m not sure.

My negative scenario

This scenario is my main prediction and I would put the probability of this happening at 80 percent.

My positive scenario

Of course I can also argue for rising prices at this point.

If we turn the 100-week moving average into a 70-week moving average we get this pattern:

Here we see that the prices sit just at the 70-week moving average and that this may act as support.

I do not think that this is a probable scenario so I would put the odds for this at 19 percent.

Conclusion:

Today I been doing technical analysis of silver once again.

Last week was a big negative week which turned the chart from being positive looking to be negative looking.

 

Monday, March 13, 2013

As always I prefer the weekly charts to draw my conclusions and this is what it looks like:

My negative scenario

What we see in the chart is that prices went down until the beginning of 2016 when they changed course.

We then were in an uptrend the first half of 2016, but then the trend changed direction again.

Now we are in between the 50-week moving average and the 100-week, but because the moves during the past two weeks were so dramatic I don’t believe prices will bounce up from the 100-week moving average.

Rather I consider it more probable to decline further, down to the ascending bottom trend line that is drawn in the figure.

If I were to put a probability on this happening, I would give something like 80 percent.

The positive scenario

Because this is technical analysis nothing is impossible and there is a real chance that prices will bounce up from here.

The probability for this happening remains low, however.

I would put it at 19 percent.

 

Technical analysis of Goldcorp Inc., Sunday, March 12, 2017

This is what a weekly chart looks like for Goldcorp Inc:

My negative scenario

Until two weeks ago the main scenario for Goldcorp was bullish as prices seemed to get squeezed between the rising 50-week moving average and the descending trend line.

But then something happened that eliminated all those bullish signs: prices cut through both the 50-week and 100 the 100-week moving averages.

Now there does not seem to be much stopping the chart before we approach the ascending trend line at the bottom of the chart.

If I were to put odds on this I would say that there is 80 percent probability for this happening.

My positive scenario

It is difficult to make a case for higher prices at this point.

But one thing that we haven’t discussed is how the underlying commodity – gold – is behaving.

It is stuck at exactly $1300 and because gold has strong support at each hundred dollars it may very well be that gold bounces up from here.

That move may then bring Goldcorp with it.

However, when I look in the Goldcorp chart I don’t see too many signs for that happening.

If I were to put odds at this scenario I would put them at 19 percent.

Technical analysis of Newmont Mining, Inc., March 11, 2017

This time I will look at Newmont Mining. This is what at weekly chart looks like:

My negative scenario

What we see in the chart is that the prices went through the 50-week moving average last week and that it moved down quite substantially.

As you can see in the chart, we can draw a trend line from the low in 2016 to the low now, but because there does not appear to be any clear evidence of a supportzone anywhere in the chart, I’m not sure that a big role.

Instead I believe that the prices will come down and touch the 100-week moving average. If you look carefully in the chart, that was exactly what happened when prices came down and kissed the 50-week moving average.

However, it could not be supported by the 50-week, but rather fell through the moving average last week.

As always I will put a probability on this scenario and I would give it 80 percent chance.

My positive scenario

My positive scenario would be that the prices bounce up from here.

Because this is technical analysis nothing is impossible, but I would put the odds for this happening as low as 20 percent.

Technical analysis of crude oil, Friday, March 10, 2017

Today I will do something different and look at a daily chart of WTI oil. This is what the chart looks like:

What I see in the chart is that prices had been trying to break through resistance ever since December of last year without succeeding.

Instead prices fell precipitously on Wednesday and that the fall continued yesterday and they now sit just at the precipice of falling down.

Of course prices can pick up from here but the strength of the fall on Wednesday make me doubt it. Instead I see it as likely that the prices will continue down.

If I were to put a probability on my negative scenario I would give it 75 percent with a 24 percent chance of prices bouncing up again.

Even if it seems unlikely I would still give the event of just continuing sideways a 1 percent probability.

 

Thursday, March 9, 2017

I prefer to draw my conclusions from weekly charts:

My bullish scenario

First of all I would like to write about my bullish scenario – the one that I consider the most probable.

Prices didn’t penetrate the 50-week moving average about a month ago and are now moving very close to the ascending trend line.

What I believe will happen is for prices to bounce off of the trend line.

That would be my primary and most probable scenario.

The odds for this happening are about 70 percent.

My bearish scenario

There’s of course also a bearish case to be made.

Last week was a week with huge price declines and what I find disquieting is that the high about a month ago was lower than the one set in August of last year.

Therefore, the declines we are seeing in the chart now may just be the beginning of a bigger decline for the goldmines.

I would put the odds for this happening at about 25 percent.

My “sideways” scenario

Finally I will talk about the possibility that nothing at all happens to the gold chart.

Because there is always a possibility for the unexpected when doing technical analysis, I would put the odds at about 5 percent.

 

 

Technical analysis of platinum, March 8, 2017

If you are a regular to this site you know that I prefer to draw my conclusions from medium-term charts. This is what a weekly chart look

What I see in the chart is that prices have failed to penetrate the 50-week moving average and that they are now heading for the ascending trend line below.

I see it as probable that prices will continue up after having hit the ascending trend line.

So what could be wrong with my analysis?

Well, first of all it is not given that prices will continue up when they touch the ascending trend line.

I would put the odds for this happening at 65% compared to 25% for them continuing down.

The odds for the chart continuing straight I would put at 10%.

 

Tuesday, March 7, 2017

If you are one of my regular readers you know that I prefer to draw conclusions from weekly charts. This is what it looks like:

What we can see in the chart is that prices declined last week and that they now sit right at the 50-week moving average.

Because the average is rising, my odds favor that the prices will continue up.

They may go down a little bit more in the near term, but not more than they did at the end of last year.

The ascending moving average is acting as support for the falling prices.

If I were to put a number on my odds then I would say that there is a 75 percent probability of the prices going up in the medium term, 20 percent of them going down and 5 percent of them continuing straight.

Is there anything that can go wrong with my predictions?

Absolutely. The prices can fall precipitously without anything stopping them. The probability for that happening remains low however.

 

 

Technical analysis of Gold, March 6, 2017

I usually prefer to look at a weekly chart to draw my conclusions and this is what the weekly looks like:

Last week the gold price was significantly down which has been worrying me a little bit.

The prices are stuck between the two moving averages, but I have a hard time seeing them crashing down through the 100-week the same way as it did with the 50-week.

Therefore I still believe that the prices will continue up, but the odds for this happening has changed.

The odds are now 60 percent that the prices will continue up to the descending trend line and 40 percent that they will fall.

We will have to wait for the resolution.

 

Technical analysis of Agnico-Eagle Mines, March 5, 2017

My preferred time horizon is weekly so this is what a weekly chart looks like:

What I see in the chart is that prices were moving sideways for the two years 2014 and 2015 and that they then exploded to the upside.

They have since come down slightly but are still about the double of what they were before the move started.

My odds favor higher prices so I believe that the ascending trend line will act as support when prices come down.

However, it is not given because we also have a lower high which can be interpreted to be bearish.

If I were to put a number on the odds I would say that ther is a 65 to 70 percent chance that the prices will bounce off of the trend line and that there is a 35 percent chance that they will continue down.

We will have to wait and see how it goes.

 

Technical analysis of Kinross, Saturday, March 4, 2017

Today I want to look at a another chart, this time of Kinross Gold Corp.

As always I prefer to look at weekly charts:

What we see in the chart is that prices were descending for the most part of 2014 and 2015, but that they then staged a comeback.

The first six months of 2016 prices were rising dramatically. At the bottom, Kinross stock sold for $1.50 and at the high it sold for 5.82. That equates to a gain of 444% if you caught it all.

Obviously, we could of course draw a similar pennant as we did in the gold and mining charts, but the information that we would get would be limited since the moves are so strong.

My odds favor a contact with the rising trend line and that we will then bounce off of that.

On the other hand there is nothing that guarantees higher prices. It is fully possible that we will break down from here.

If I were to put a percentage on my odds, I would say that there is a 65 percent chance of prices going higher and 35 percent chance of them going lower.

We will have to wait and see.

Technical analysis of crude oil, Friday, March 3, 2017

As always my preferred time horizon is weekly. This is what a chart of WTI crude looks like:

What is clear from the chart is that prices were declining since the end of 2014, but that they changed direction and began to trend upwards at the beginning of 2016.

What we have is really two opposite trends – one descending and the other ascending – and they will soon collide.

When the pattern looks like this there is a lot of tension that is building up in the chart and when this tension is finally released the moves that follow usually are violent.

As it looks now prices have tried to break through the resistance that exist around $55, but to no avail.

My odds therefore favor that the penetration through the resistance will fail and that we will soon see a lot cheaper crude oil.

 

Technical analysis of the HUI, March 2, 2017

A common way of leveraging the price of gold is to invest in gold mines.

The way that I look at the gold is that it’s very much the same as buying a currency.

To invest in gold mines is fundamentally different from buying gold because you are actually buying equity.

Sometimes these stocks pay out a dividend which means that you can take advantage of compound interest the same way as with any other stock.

The Gold Bugs Index

As always I look at a weekly chart when I do my analysis:

What we can see in the chart is that the trend changed direction and headed downwards in 2011 and that the trend was down all the way to 2016.

Then in 2016 the trend changed and increased almost 300% in just a few short months.

The trend then changed again mid-2016.

But one thing that did not change was the direction of the 50-week moving average. It is still trending upwards.

The chart is now between the rising 50-week moving average and the rising trend line that can be drawn between the bottoms of 2016 and 2017.

I personally don’t think that prices will go down very much in the medium term because of the rising moving averages and trend lines.

Therefore there could not be a better moment to enter the market than this.

 

Technical analysis of platinum, March 1, 2017

As always I prefer to look at a weekly chart:

What we see in the chart is that prices of platinum headed south mid-2014.

They then were in a downtrend for something like 18 months when they had a come back.

The first half of 2016 the overall trend of platinum was up, but that changed around the US elections when prices headed down again.

What happens when prices are moving up and down like this is that neither the bulls nor the bears have the upper hand.

Rather the battle lines are only getting closer.

What that means is that a lot of tension is building up in the chart and when that tension is finally relieved the move will become spectacular.

The trouble is that I don’t know in which direction it will move. My personal hunch is that it will move higher, but that is not a completely unbiased opinion,

My personal odds are that prices will continue up after the chart has broken the descending trend line.

If you believe in higher prices it’s a very good time to enter.

 

Tuesday, February 28, 2017

As always I use a weekly chart to draw my conclusions:

There are a few things going on in the chart.

What we see is that prices were heading down for the better part of 2013, 2014 and 2015.

But then they changed direction in the beginning of 2016 and have been moving up ever since.

Furthermore, we don’t have the same clear bottom as we have in the gold chart, but rather a more extended support zone (see figure).

Obviously, we can draw ascending and descending trend lines, but I’m not sure if they are really in play in the market.

We blew right through the descending trendline a couple of weeks ago without any struggle. That indicates that it is not really in play.

Then the 50-week moving average is ascending as well as the 100-week which to my eyes looks healthy.

In short it seems to be a good moment to enter the silver market.

 

Technical analysis of gold – February 27, 2017

As always I look at a weekly chart to draw my conclusions:

What we see in the chart is that prices went down for the better part of 2013, 2014 and 2015.

Then in 2016 the direction of the trend changed to move upwards where it moved during the first half of 2016.

But then after the American elections prices trended downwards. They did so for a couple of months until they changed direction again.

As can be seen in the chart, the prices are now up against the 50-week moving average, but because the moving average is not down trending I don’t believe that it will cause too much resistance.

That means that I believe that the prices will continue to the descending trend line above.

What happens then is anybody’s guess. It may be that the uptrend is so strong that it will cut through the descending trend line without problems.

Or it may be that the prices change direction once again and build up more tension than what is already present in the chart.

We will have to wait and see.

If you want to learn the basics of technical analysis you can do that here.

Popular articles:

Guide to Technical Analysis


Guide to Value Investing


Using Microsoft Excel in finance


Subscribe to RSS

Business Blogs - The Blog Index

Follow me on Blogarama