Was away for a retirement party for a friend last evening… Gold and silver closed mixed, after all the trading was over Friday. Gold was down slightly, while silver was up a bit. You know I was hoping for better. From the Kitco metals price site, I go to my trading account with eOption, lowest cost on-line broker I know anything about, and I see that all my holdings there were down, but one… it closed unchanged.
What do I think of this? I saw prices up and I saw them down through the day. It was a see-saw kind of a day. I know traders must be starting to get a little anxious, so I’m thinking turn-over, hence volume, might be starting to rise some. That’s my story, and I’m stickin’ to it… until I study all the charts! Will they confirm or deny my thesis?
With a bearish engulfing candle, and an increase in volume, I see GLD went down. Pretty big negative right there. Price support has held, and is not yet being challenged. Any others like that? Yup, RGLD, SLW, SGDM, PVG, GDX, PAAS, SILJ, ABX, FSM; CDE closed unchanged.
On the other hand, SLV close up, and on big volume, too! So, we have a dichotomy, a divergence, going on here. This greatly weakens the bigness of the negative relating to GLD. Will we have more like SLV? No, because I already know that all the miners, but one, declined. So, the interpretation for GLD and those others is much stronger.
Others that fell on lighter volume were: SGDJ, HL, SSRI and AG. But, these are also of the bearish engulfing candlestick type.
Nearly every chart displayed a bearish engulfing candlestick, and most on an increase in volume, too. I’m not the only one that knows about the follow-through, confirmation rally that is to be 4 to 7 business days after a market reversal. Other traders know it, did not see it coming to fruition by Friday’s end, and sold. While average volume for all was higher than Thursday’s or Monday’s downside volume, it was still some 27% below the 50-day average, so it was not an abandonment, a giving up of all hope… not yet. We now have days 7 thru 10 to watch for the follow-through, confirmation. If it is not forth-coming then, it might take a further turn for the worse.
Here’s to your accumulation of real wealth!
Harold F Crowell