As we often witness, gold and silver could be reversing trend. This morning they are both trying to break to the upside as they hover just above resistance. The keys to watch for today: Does gold close above 1860? Does silver close above 22?
From a technical view, those are the levels to watch. The price action has subtly changed. Where we once would be an aggressive short, we are now holding our current position. We are no longer looking to add realizing a close above the resistance levels could trigger a reversal.
If you are trading, you must recognize changes as they occur and not be too stubborn to change. The challenge for today is the holiday weekend making volume almost nonexistent. Today is about observation and not active trade.
We don’t trade news or economic conditions because the markets have already priced in that information. From here, we will observe but know we will not be trading or reversing gold and silver until at least Monday night.
Precious metals should be owned on a physical basis with capital that is not needed tomorrow or anytime soon. Trading should be done with paper knowing that we can trade either side without emotions.
In all markets price action determines what will happen in the next day, week, or months. Keep the two strategies separate, the worst trade anyone can make is turning a trade into an investment hoping for a way out. Traders must learn to take their losses and move on to the next trade.
Patience, discipline, and money management always win the day. Let the map of the markets show you the way.
