Silver 8 hours chart

Nothing goes strait up , like gold, silver is building a base and consolidate before making a move that will take it above 10$, I don’t think that any pullback in the price of gold or silver is going to be deep nor sustained.

I have annotated the 8 hours silver chart with wave count, Fibonacci levels and trend lines. Click on the chart below to enlarge:

Gold spot one hour chart

Gold had some kind of pullback today, Elliot waves count suggest this is not going to be a deep correction and higher highs are just around the corner but the count is not confirmed so caution is warranted.

Click on the chart below to enlarge.

Gold and Silver four hours charts

Yet another good day for the precious metals sector, gold , silver, platinum all made new highs while palladium had the best performance the last couple of months gaining around 50%. This is the beginning of the second wave up for the precious metals (Elliot wave 3) , the industrial metals along many other commodities are also acting very strong. Money managers and the financial industry are getting more interested in this market and the fundamentals are bullish. However this is the year of the dog and I expect gold (DOG _L) to finally get rid of its lousy image it had the last quarter century and be one of the best performance assets for 2006, not just among currencies but also among commodities.


Click on the charts below to enlarge



commodities charts: Palladium Futures (PA, NYMEX)

XAU – Philadelphia Gold & Silver Index

Not Much change in the gold market today, silver pulled back some but not too much.

CBOT Expands Precious Metals Complex and Launches 100 Ounce Gold Futures Options read more

Expect more of the same for the foreseeable future. New exchanges for gold and commodities will open all over the world as the sector will be more and more interesting for Investors. Long way to go...

Gold Indices have done great the last couple of month as Investors like stocks better then futures or physical stuff. I expect that to change over time and will not rule out the possibility that gold will outperform most of the gold stocks or at least the gold Indices; likewise I am not sure at all that silver will outperform gold.
In my opinion all gold and silver "Investors" should have some physical metal at hand – especially small investors.

More later – real1.


My last review of the XAU Index:
Gold global perspective: The gold stock indices

How high will gold go in 2006?

Since the second wave up started (E-wave number 3) around mid July 2005 the Gold / USD exchange rate gained around 37%. I made a short study and found that from each bottom to date the rate of change was actually faster. Simple average of all rates of change per week will give a rate of change of 1.8% per week. This is a modest estimation since the rate has proven itself to be accelerating for the past half year.

So if we simply use this rate of 1.8% per week and the remaining 48 weeks for 2006 the number we get is 1068$, this is a realistic and conservative price target for gold in 2006. As the data will accumulate I will update this study and try to give more accurate prediction.

Click on the chart below to enlarge: