Failed Triangle Breakouts

Stocks ended the week not doing much and remaining in a very overbought range.

I remain quite short of some leading stocks.  However, we did see several failed breakouts Friday, which does point to some retracement that could be great for me.

We can chop sideways and consolidate to work off this overbought reading, but it hasn’t yet happened. Therefore, I’m looking to cover my shorts near cost if we do chop…or at a profit preferably, if we do correct.

As for the metals, they tried to breakout higher out of triangle patterns in the cases of gold, silver and platinum…but then failed with silver leading the way lower. I’ve had several email conversations with people this past week regarding lows being in for the metals. Their responses were that I needed to see how the monthly chart closes out. The monthly chart needs to close above $1,300 for me to declare the major low is in place -- and then we can see gold move higher in a trending manner. However, that is not looking likely this month.

The monthly chart is most important, and. Being monthly, it takes time but is looking better, however, not yet out of the woods.

Gold ended the week down only 0.31% …but silver is showing that it will fall further in the week ahead.

I noticed this triangle pattern early in the week and gold showed a nice breakout, but then retraced. Breakouts or breakdowns which fail most often point to a move in the opposite direction. Support is the $1,200 level now, then the long-time major pivot area at $1,180.

The monthly chart could take a few months to really base and then breakout, which would be preferable since a solid base is always best to move away from.

Silver lost 4.36% this past week and is leading lower. It tried to move above this triangle pattern, but failed…and failed hard on solid volume. It looks like silver is leading lower so it must be focused on.

So far silver is holding the 100 day average at $14.70…but major support sits at $14.50.

I’ve long said gold needs to test and hold the $1,000 area -- and silver the $10 area in order for a major low to be in place. And that may yet happen as they setup bases on the monthly charts.

While the dominant trends do remain lower, they are moving towards sideways now which is a sign of lows being near.

Platinum lost 2.61% this past week and is breaking under $920 which is negative. Platinum has a bull flag pattern but with silver weak and platinum breaking under $920 it isn’t so great. $900 is major support, then $880 and it will follow gold and silver.

Palladium fell 3.33% on the week and has to hold $475. Major support sits at the $390 level on the monthly chart -- and would be the next stop if gold and silver continue to show weakness since they always lead platinum and palladium.

********

In my free, nearly weekly newsletter I include many links and charts which cannot always be viewed through sites which publish my work.  If you are having difficulties viewing them please sign up in the right margin for free at www.wizzentrading.com or send an email to [email protected] with “subscribe” as the subject and receive the newsletter directly in your inbox, links and all.  If you would like to subscribe and see what my portfolio consists of please see here.

If you found this information useful, or informative please pass it on to your friends or family. 

Free Service

The free weekly newsletter “Wizzen Trading” does not purport to be a financial recommendation service, nor do we profess to be a professional advisement service.  Any action taken as a result of reading “Wizzen Trading” is solely the responsibility of the reader.  We recommend seeking professional financial advice and performing your own due diligence before acting on any information received through “Wizzen Trading”.