As I have been noting of late, both gold and silver have been trapped in sideways trading patterns for some time now, meaning that there really has not been a whole lot worth saying about the price action in either metal.
That MIGHT POSSIBLY be changing in regards to silver. The reason is simple – price is down at the very bottom of the sideways trading range that has been intact for nearly seven weeks.
Additionally the price fell through the 50 day moving average today, the first time it has done that since early June although it did recover slightly ahead of the closing or settlement price – just barely however!
One other thing worth noting, the bottom technical indicator has remained in a bearish posture since the middle of July while the ADX/DMI has kept the bulls in charge with the +DMI remaining above the -DMI over the sideways trading pattern. For the first time however, in a long time, we have gotten an actual sell signal in those DMI lines.
As you can see, the actual ADX line itself has been moving steadily lower after peaking in mid-July, a sign that the ferocious uptrend that had been taking place through June was going to be pausing. It continues to move lower indicating the choppy price action during this sideways trading action. With the upside crossover of the -DMI above about the ADX line and the +DMI, this might possibly be the start of a bigger retracement lower in price. It will all depend on what or not today’s low now gives way and silver closes below that 50 day moving average.
Silver prices are down $0.41 as we write gold opens sluggishly..
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