Weak Stock Markets…Strong Precious Metals

A very choppy week for stocks until Friday when the downtrend resumed.

I tried several stock trades this past week and took mostly small losses. However, we have two trades which are working very, very well and paying for those losses and much more.  I usually have a pretty good win/loss ratio but not this week. However, by keeping losses small, we’re still way ahead of the game.

I don’t mind being wrong, but I do mind staying wrong. Consequently, I take small losses if they come, quickly.

As for the metals, they moved nicely higher…with silver kicking into gear and confirming this gold move higher.

Gold gained a nice 4.98% this past week as silver also moved up and confirmed this strength. Gold is now up against the $1,180 resistance level and should rest.

I’d like to see a couple weeks of consolidation now, which would form a handle and complete a large cup and handle pattern. And if we do complete a cup and handle, then that would change my view on gold and I’d say we have a major low now in place, which we can move up from.

Time will tell but for the first time since 2013 -- and things may soon be positive with the dominant trend up again.

Silver gained 5.44% this past week as it moved above the long base area very nicely. We’ve finally got gold and silver moving higher together.

The $15.25 area is now resistance. Therefore, we should look for some consolidation before moving higher again to the next resistance area at $15.75.

To be sure the great action on solid volume is finally very positive.

Platinum gained 4.74% this past week -- and finally has gold and silver on its side. Looks like clear sailing up to $940 now for platinum -- and then horizontal resistance and the 200-day average are at $980 and should slow things down for a few weeks.  Platinum is finally looking positive.

Palladium rose 0.93%...but isn’t joining into the party quite yet. It looks like palladium really needs to move past the $525 level to get going.  Then there is resistance at $525, where we may expect some consolidation.

So, while the stock markets are not looking so hot, the metals area really is perking up as the US dollar is experiencing some recent weakness. Generally the US dollar and gold move in opposite directions. While  the dollar is showing weakness, it has moved back above the 200-day moving average. Therefore, I’m not so sure the major uptrend has changed yet.

For now, it’s good to be short stocks and long metals.

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