Gold and Silver End the Week Range Bound

By Tom Luongo in Gold and Oil News | May 4, 2013 16:05 | Tags: , , , ,

Bravo to the money masters this week, pushing and pulling the timing of the news to reinforce a range trade in Gold and Silver.  This is keeping the mo mo monkeys out of the market — a game that has been going on now since the first day of trading this year when the price of Gold was set to spike and was brutally smacked down.

Don’t fight the Fed, right?

The line in the sand in gold remains $1485 per ounce.  Underneath that is a stair-stepping pattern beginning at $1440 per ounce that is clear as day on the intra-day charts, with buyers coming in to support the price at slightly higher levels each time.  The current low that needs to be watched was set on Friday morning after the farcical BLS report at $1456.  Each reaction off of $1485 is shallower by about $5.00 each time, so, at some point next week we will reach another decision point in gold and the bulls will either take it through $1500 or another historic bear raid will take place.

Silver is being hit even harder because this is a physical delivery month and we’ve already seen more than 16 million ounces stand for delivery this month.  You can bet that if silver were above $26 per ounce, or back near $30, that that number would be much, much higher.  So, it is very likely we won’t see much of a rise in the silver price until this wave of buying is over and the COMEX May contract supply is mostly worked out.  But, if the rally in Brent Crude and the short squeeze in Copper have legs, then the Silver market could get disorderly quick.

 

About Tom Luongo
Tom is a professional chemist and self-taught economist who has been following and trading stocks for nearly 12 years. He has no formal ties to the financial industry and considers that an asset in his analysis of the interplay between monetary policy and capital markets.


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