Gold and silver have come under pressure in recent days, as the recent ascent is called into question given the hesitancy around key historical resistance levels. With that in mind, it is worth understanding exactly where we stand in the grand scheme of things with regards to both markets.
The weekly chart highlights the fact that we have seen the price begin to turn lower from a crucial descending trendline, originating in July 2016. Above that we also have a key resistance zone of $1303-$1307, which marks the culmination of a host of tops and bottoms in the past two years. In some ways we have the clear creation of lower highs (as captured by lower highs), alongside the creation of lower lows with the December break below $1200. That would lead us to believe we are due to turn lower soon. However, another way of looking at this market would be that we have been retracing the falling wedge break-out back in January 2016. The fact that the market turned higher exactly on the 76.4% Fibonacci support level ($1125) back in December 2016, provides us with a clue that the downturn evident since July 2016 could be a retracement rather than reversal. This would then look to be a precursor to follow through on the early 2016 breakout. For that to be confirmed, we would need to see a break through $1337.