Gold and silver are now below some critical levels and are in the process of heading lower. This brings us to the question are gold and silver breaking down? The answer is not that simple but would be yes for now and the future. In simple terms, we trade gold and silver as the trends change, trying to benefit from short-term movements. We hold physical metals for the long-term, knowing they will appreciate.
Therefore, trading and investing are tough for many, separating the goals and expectations of what happens over the next week versus what we expect to happen over the next 10 years. If you can’t separate the two, you should not be attempting to do so. They run on different cycles.
Gold and silver are headed lower and violating key support levels. The keys to watch are $1,800 gold and $210.0 silver. We have been short gold since April 25th at $1,907 and silver from $23.61. We are sitting on large profits and looking for more, the trend is down.
We all must remember that trends can change without notice and we could reverse at any time. However, we don’t try and time that move; the price action will tell us. Until further notice, the price action is bearish and lower prices are coming.
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 month. 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.
Join me Monday at 4:30 EST for our Monday Night Strategy Call. The link to register is below.
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.