Silver retests recent highs
Gold is trading sideways this morning. This follows a strong session yesterday which saw it close at a fresh all-time high. Just under a fortnight ago, gold managed to burst out of a month-long trading range between $2,470 and $2,530. Since then it has continued to push higher, adding around 6%. The daily MACD has also picked up sharply, although it is not particularly overbought. So far, there hasn’t been any significant pullback, or period of consolidation during this latest leg of the rally, and that could be something that is weighing on traders’ minds. Meanwhile, it is silver which has really taken off to the upside. Yesterday it jumped close to 5% taking it above $32 per ounce for the first time since the end of May. This proved to be the high for the summer, as silver subsequently fell around $6, or 18% over the next two months. At the beginning of last month, silver hit a multi-month low, just under $26.50. Since then it has rallied over 20%. But this is now a key area for silver. If it is unable to break and hold above $32 over the next few trading sessions, and if the area around $31 fails to hold as support, then we may see a more protracted downside correction. But if silver can take out its highs from back in May, then further gains seem likely.
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