Jordan Roy-Byrne, Founder and Editor of The Daily Gold, joins us to review both the fundamental and technical factors he is watching in gold, silver, and the PM mining stocks, now that they have clearly bottomed and are in a new bull market. While there will be corrections along the way, there is nothing on the charts or the macro landscape suggesting another big “wash out” event being needed for the sector to move higher.
Jordan provides some technical indicators he values, like the 200 day, 400 day, and 40 month moving averages, lateral price levels, and gaps on the charts, and points out that much of the other chart overlays are just based on price derivatives and momentum indicators, and he places little importance on those over the actual movement of price. In gold he noted $1800 and $1780 support levels, and below that possibly the gap zone between $1762-$1780. In silver, if $23 were to break then there is the $21.80 gap area, and support below $21 in the high $20s near the 200 day moving average. He also provides support targets for GDX and GDXJ.
The big takeaway is that at this point, investors should be more concerned with macroeconomic developments, rather than just technical price levels. In bull market moves, the corrections are typically shorter and more shallow, and therefore don’t correct as much as people on the sidelines waiting to buy corrections are expecting.
We wrap up with some thoughts on breadth readings, the advance/decline line metrics, and intermarket analysis with gold outperforming everything recently – US equities, commodities, and foreign currencies. If those macro factors don’t change, then pullbacks will be more shallow and represent good spots for traders to scale into positions.
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Click here to visit Jordan’s site and keep up to date on his market outlooks.