Gold, Silver, Palladium Mildly Rally in June 2014 While Platinum Neutral

The following is an excerpt from Yamada’s latest monthly update for premium subscribers, released today. We highly recommend subscribing to the monthly in-depth analysis of Louise Yamada on www.lyadvisors.com.

Gold

Gold Spot price continued down to 1,240 before reversing on the global upheavals which eliminated any imminent test, or break of 1,200 (see Figure 18). Gold price is now midway within the four-year trading range between roughly 1,400 and 1,200.

The rally carried through the 2012 downtrend (see dashed downtrend) and lifted again through the 200-day MA. The next resistance arrives with the 2013 downtrend near 1,360 and above that at the price resistance from 2014 at 1,383-1,388. The weekly momentum model is trying to turn positive and the monthly is also trying to improve toward positive.

Lifting through 1,400-1,433 would reflect a breakout from the year-plus consolidation range. The potential for a continued rally could carry to the next resistance of the broken support in 2013 at roughly 1,540 and close to the 2011 downtrend resistance at 1,560. We think it is too soon to jump to conclusions that Gold is renewing a structural bull market, but at least technically there could be further rally potential short term.

Current support is at the recent low of 1,240. Were price to fail to overcome the noted resistance levels, the potential for further consolidation / weakness should be considered.

gold_spot_price_weekly_June_2014

The Market Vectors Gold Miners ETF (GDX-25.97) would need to lift through 30 to suggest the consolidation following the 70% decline might be over (see Figure 19). We doubt technically that a major advance will evolve over the short term considering the greater the decline, the longer the need for repair.

The S&P 500 versus Gold ratio retains the uptrend favoring stocks over Gold, albeit with a slight pullback as occurs within any structural trend (see Figure 19).

GDX_and_S&P-to-gold_weekly_June_2014

 

Silver

Silver Spot price has resistance levels similar to that of Gold to overcome at 21, 22 and 25, the upper consolidation range, in order to suggest further appreciation.

Platinum

Platinum spot price retains the same consolidation depicted herein last month with resistance at 1,500 and support 1,400. Technically, the fact that price is holding in the upper half of the year-long wider range (1,500-1,300) suggests that demand is coming in as price declined toward 1,400, not letting price drop below. That behavior should ultimately result in a breakout. The monthly momentum has just turned positive to join the weekly, barely positive, which should add credence to the potential for a lift as we await price proof with a move through 1,500 and 1,550, the 2011 downtrend. Support 1,400 and 1,300.

Palladium

Palladium Spot price has consistently remained the strongest of the metals we cover (see Figure 21), extending gains to 864 after successfully penetrating the trading range resistance near 790, and has challenged the 2010-2011 highs. Price appears in the process of consolidating the gains of 2014 above 800, now support, near the point of breakout and the 2008 uptrend.

Weekly and monthly momentum models are positive suggesting further upside is possible. Any further rally could carry toward 900.

palladium_price_weekly_June_2014

 

Louise Yamada is one of the most respected technical analysts we are following is Louise Yamada. Her independent research company provides in-depth and thought-provoking analysis on all markets, including precious metals. An outstanding feature of the analysis is that readers are offered different perspectives on each market, which sometimes reveals trends that are rather invisible. For precious metals investors it helps to put the metals markets activity in a broad perspective of ongoing market trends. In other words, understanding broad market activity is helpful to interpret the state of the metals market. 

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