RJO FuturesCast

Daily Futures Market News, Commentary, & Insight

Metals

Continued Intra-Range Gold, Silver Gains Define New S-T Bull Risk Levels | RJO Futures

Posted 05/26/2017 8:39AM CT | RJO Market Insights

JUN GOLD

Overnight’s break above the past week’s 1264-handle resistance reaffirms the developing uptrend from 09-May’s 1214.3 low and leaves today’s 1252.6 low in its wake as the latest smaller-degree corrective low the market must now sustain gains above to maintain the impulsive integrity of a more immediate bullish count. In this regard 1252.6 is considered our new short-term risk parameter from which traders can objectively rebase and manage the risk of a still-advised bullish policy.

Gold 240 min Chart

 

Gold Daily Chart

This tight but objective risk parameter may come in handy given the market’s position still deep within the middle-half bowels of the past year’s 1358-to-1133-range on a weekly log close-only basis below where we consider the odds of aimless whipsaw risk higher as well as below 17-Apr’s 1297.4 high shown in the daily chart above. If there’s a time and place for this market to “fail” and defer a broader bullish count, we believe it’s from this 1265-to-1297-range. And we’ll gauge such a failure around today’s 1252.6 low.

UNTIL such sub-1252.6 weakness is proven however, AT LEAST the intermediate-term trend is up and should not surprise by its continuance or acceleration with former 1264-handle area resistance considered new near-term support.

Gold Weekly Chart

 

We would remind traders of our long-term bullish count that contends that early-2016’s rally, in fact, broke the secular bear trend and exposes a correction or reversal higher that could be major in scope (i.e. to levels ranging from those just above last year’s 1377 high to an assault on 2011’s 1920 all-time high). The interim challenge however is the market’s position deep within the past year’s 1377 – 1124-range where aimless whipsaw risk for an indefinite amount of time and angst should hardly come as a surprise.

In sum, a cautious bullish policy remains advised with weakness below 1252.6 required to negate this specific call and warrant a move to the sidelines.

Gold Monthly Chart

 

 

JUL SILVER

The technical construct and expectations for the silver market are virtually identical to those detailed above in gold with overnight’s break above Tue’s 17.305 high leaving Wed’s 16.895 low in its wake as the latest smaller-degree corrective low and new short-term risk parameter the market needs to sustain gains above to avoid confirming a bearish divergence in momentum. This tight but objective risk parameter may come in handy as the market nears a pair of Fibonacci retracement and progression relationships at 17.357 and 17.405 shown in the 240-min chart below.

Silver 240 min Chart

 

Silver Daily Chart

Here too the market’s position deep, deep, within the middle-half bowels of the 18.65-to-15-67-range that has encapsulated it for the past seven months maintains the odds of aimless whipsaw risk. Increased odds of such whipsaw risk will be gauged by the market’s ability to sustain current gains above 16.895.

Silver Weekly Chart

 

From a long-term perspective early-2016’s recovery, in fact, broke the secular bear trend from 2011’s 49.82 all-time high, exposing a correction or reversal that we believe will be major in scope and expose a run to anywhere from, new highs above last year’s 21.225 high to the 2011 high. Whilst constrained within the 7-month range however or until negated by a failure below Dec’16s 15.675 low and our long-term risk parameter, further aimless, intra-range whipsaw behavior remains a threat.

In sum, a cautious bullish policy remains advised with a failure below 16.895 required to move to the sidelines.Silver Monthly Chart

RJO Market Insights

RJO Market Insights specializes in forward-thinking analysis, focused on potential market-moving events and dominant factors driving price discovery. Detailed fundamental and technical coverage across multiple commodity sectors is combined with objectively-constructed trade recommendations to provide an industry-leading product for R.J. O’Brien’s Institutional clients, commercial hedgers, introducing brokers and individual investors free of charge. Content is distributed in both text and audio formats, with specialized service offerings provided by account type.
For more information on RJO Market Insights, contact your broker or RJO representative.