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Weekly Analysis – Bullish Re-Ignition?

Precious Metal – Bullish Re-Ignition?

Dovishness in the US dollar is playing a huge implication to further weaken the greenback against other currencies. Overdue correction is in play and we are entering April 2015 with further weakness unless of course we see a better economic data.

We took note that bad economic data from the US did not replicate with higher equity prices and this showed a broken correlation that bad news are good news for the equity market. As we have covered in our commentary, Central banks around the world have changed the landscape ever since we enter 2015. US equity market may have lost its shine and movement away to a higher yield market is in effect. Europe, China and Japan QE-fuelled equity market is far more viable opportunities and hot money is chasing after whatever yield they can get. The fertile QE laden promises will be a constant reminder that what the US has done can be replicated elsewhere. This of course comes at a cost to the US economy that is barely improving and faced potential risks from deflation, a strong US dollar and threat of an interest rate hike.

This quarter economic situation will be impossible to read as usual, given that we are juggling with various social, political and economic situations around the world. One thing for sure, June rate hike seems far-fetched and September looks more viable. Currency market could make a temporary short covering but we continue to expect a strong dollar after this corrective phase.

 

Gold Technical Outlook

Weekly Chart

 

Gold ended with a bullish doji candlestick (hammer) – promising a potential zone for more upside. An Inverse Head and Shoulder pattern could play out should gold prices break and close above $ 1225 area. The potential targets are $ 1245 and $ 1287 with a far reaching target of $ 1305 area. In the short term, there is a lot that needs to be done by the bull. However, we will not fail to mention that this could be a corrective move in a bear market.

 

Trade: Below $ 1176 gold could go lower while a break above $ 1225 gives room for a potential IHS. Valid for this week only.

 

Position Valid Date Price Action Stop Loss Target Results
LONG 6th – 10th Apr 1230 Order Placed 1212 1271

 

20 WMA 50 WMA 100 WMA
1211 (+1) 1244 (-2) 1276 (-3)

 

Weekly chart – Chart ends with a bullish hammer candlestick suggesting potential upside.

Silver Technical Outlook

 

Weekly Chart

 

Resilient silver prices with support found at $ 16.43, it staged a consolidation phase that is supported by a weak US dollar. With gold potentially doing well, Silver has the chance to break above March high at $ 17.41 to retest $ 18.00 mark. Despite that, we are unsure on the next catalyst to warrant higher silver prices – so caution is recommended before we take any more trades. Short term paints a bullish picture for silver prices to test higher prices. Below $ 16.45 then we target $ 16.16 area but a break pass $ 17.41 will allow silver to test $ 18.00.

 

Trade: Below $ 16.45 then we target $ 16.16 area but a break pass $ 17.41 will allow silver to test $ 18.00. Valid for this week only.

 

Position Valid Date Price Action Stop Loss Target Results
SHORT 16th – 20th Mar 15.95 Closed 16.35 15.80 (15.30) -40
LONG 6th – 10th Apr 17.45 Order Placed 17.05 17.90
SHORT 6th – 10th Apr 16.42 Order Placed 16.72 16.15

 

20 WMA 50 WMA 100 WMA
16.64 (+1) 17.24 (-5) 18.50 (-5)

 

4 Hour Chart (30th March report) – Other indicator suggest a small pullback after a good rally but silver prices often fall faster than rises

4 hour chart (6th April report) – Comparing with previous report and our analysis, showed a resilient silver bull with an upside opportunity to break higher if it can close above $ 17.41

 

Monthly Chart – Watching the long term trend line acting as support for now at $ 14.65 and rising. Could Silver kick start another rally from this trend line?

Platinum Technical Outlook

Weekly Chart

 

Support for the week was at $ 1112, higher than the previous low of $ 1086.20 – suggesting a higher low and price did bounce of the lower Bollinger band. The RSI also trend higher but with resistance coming from the trend line, we could take risky buy in at $ 1160 to target $ 1185 area.

 

Trade: Buy in at $ 1160 stop at $ 1151.90 target $ 1190. Valid this week only.

 

Position Valid Date Price Action Stop Loss Target Results
LONG 09th -13th Mar 1155 Closed 1150 1172 -5
SHORT 23rd – 27th Mar 1147.5 Closed 1152 1090 -4.5
LONG 6th – 10th Apr 1160 Order Placed 1151.90 1185

 

20 WMA 50 WMA 100 WMA
1195 (+/-) 1311 (+/-) 1368 (+/-)

 

Weekly Chart – Notice the Trend Line. Will prices set to retest the upper trend line before breaking lower?

 

 

 

Palladium Technical Outlook

Weekly Chart

 

We see a short term revival in Palladium prices for the week but any rejection from $ 770 area then further downside risk to target $ 700 is a possibility.

 

Trade: Buy on the open or above $ 752 to target $ 770 area with a stop at $ 722. Valid for this week only.

 

Position Valid Date Price Action Stop Loss Target Results
LONG 6th – 10th Apr Open Order Placed 722 770

 

20 WMA 50 WMA 100 WMA
786 (-3) 809 (-2) 770(+/-)

 

4 hr Chart – Prices did break out and drop for about $ 40 dollars.

Weekly Chart – RSI holding on support – waiting for short term time frame for more confirmation.

 

This article is written according to the author’s views and by no means indicates investment purpose. Opinions expressed at Sharps Pixley Ltd are those of the individual authors and do not necessarily represent the opinion of Sharps Pixley Ltd or its management, shareholders, affiliates and subsidiaries. Sharps Pixley Ltd has not verified the accuracy of any claim or statement made by any independent writer and is reserved as their own and Sharps Pixley Ltd is not accountable for their input. Any opinions, research, analysis, prices or other information contained on this website, by Sharps Pixley Ltd, its employees, partners or contributors, is provided as general market commentary and does not constitute investment advice. Sharps Pixley Ltd will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information. The data contained on this website is not necessarily real-time or accurate. 

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