Silver And Gold Confirm Bull Market
Peter Brandt | Jul 06, 2016 11:20AM ET
Silver and gold have made some decisive moves of late. It must be emphasized that the long-term trend in silver and gold is up. I believe we are now witnessing a silver Bull Market and a gold bull market. Despite the fact I have preferred the long side of silver over the long side of gold, I have grossly underestimated the power of this silver trend. Thus, a reappraisal of the silver chart is in order.
The advance on June 29 met the target of 18.52 established by the Apr 12 completion of an 8-month H&S bottom. As a result, Factor is now flat in silver. This trade ended up as a profit, thus establishing silver as a qualified member of the 2016 Best Dressed List and a Bottom-Line trade for Factor.
h3 Silver Bull Market/h3It is possible to interpret the strength in silver this past week as the completion of a possible 33-month H&S bottom with an extremely abbreviated right shoulder. The target of this pattern is 22.40, although a retest of the 2011 and 2012 lows just above 26.00 is very possible. I am most interested in buying a meaning correction in silver, although I doubt that a hard retest of 18.00 (right shoulder high) will occur. Traders who focus on Fibonacci corrections should remain alert.
/h3
The broadening pattern is typically reversal in nature. Very rarely will a continuation broadening pattern occur. The advance in gold in early Feb 2016 completed a 16-month falling wedge bottom with a target of 1392, as shown on the first daily chart shown below.
The advance on Friday reconfirmed the likelihood that the broadening triangle is continuation in nature — with a target of 1407. Thus, the next target in the bull gold market is in the 1392 to 1407 zone. Factor established a long position in gold on Friday afternoon.
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