Natural Gas Price Prediction – Prices Slide Following Inventory Report

Natural gas prices continued to trading in a tight range, unable to break out or break down. This followed a slightly less than expected build in natural gas inventories reported on Thursday by the Energy Information Administration. The weather is expected to be colder than normal over the next 6-10 days in the East Coast and the mid-Atlantic. Energy production in the U.S fell 5% in 2020. Total production of energy in the United States fell to just below 96 quadrillion British thermal units.

Technical Analysis

Natural gas prices moved lower on Thursday after testing resistance levels and failing. Target resistance is seen near the February highs at 3.06. Short-term resistance is seen near an upward sloping trend line that comes in near 2.97. Support is seen near the 10-day moving average at 2.92. The 10-day moving average crossed above the 50-day moving average, which means that a medium-term uptrend is now in place. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal. Medium-term momentum is positive but decelerating as the MACD (moving average convergence divergence) histogram prints in positive territory with a sliding trajectory which points to consolidation.

Natural gas in storage was 1,958 Bcf as of Friday, April 30, 2021, according to the EIA. This represents a net increase of 60 Bcf from the previous week. Expectations were for a 65 Bcf build in stockpiles according to survey provider Estimize. Stocks were 345 Bcf less than last year at this time and 61 Bcf below the five-year average of 2,019 Bcf. At 1,958 Bcf, total working gas is within the five-year historical range.

Gold Price Prediction – Prices Break Out on Dollar Break Down

Gold prices surged higher on Thursday as the dollar headed south. U.S. Treasury yields moved lower despite a decline in jobless claims. Initial claims for unemployment benefits fell sharply last week, sinking below 500,000 for the first time since the Covid crash.

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Technical analysis

Gold prices moved higher on Thursday breaking out above trend line resistance. Support is now seen near former resistance, a downward sloping trend line near 1,799. Target resistance is seen near the Fibonacci retracement level of 38.2%, which is seen near 1,828. Additional support is seen near the 10-day moving average at 1,783 and then the 50-day moving average at 1,745. The 10-day moving average has crossed above the 50-day moving average, meaning that a short-term uptrend is now in place. Short-term momentum has turned positive as the fast stochastic generated a crossover buy signal. Medium-term momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This occurs when the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line).

Claims Fall More than Expected

First-time claims for unemployment insurance fell below 500,000 for the first time since the pandemic crisis. Initial claims totaled 498,000 for the week ended May 1, against the estimate of 527,000. That was down from the previous week’s total of 590,000, which saw a substantial upward revision from the initially reported 553,000. However, continuing claims actually ticked higher last week, rising 37,000 to just below 3.7 million. The four-week moving average for claims edged down to 3.68 million, the lowest since March 28, 2020, just as mass layoffs were beginning to combat the spreading coronavirus.

Natural Gas Price Prediction – Prices Whipsaw Ahead of Inventory Report

Natural gas prices whipsawed on Wednesday, closing lower on the session, unable to push above resistance. This movement comes ahead of the Thursday inventory report from the Department of Energy. Expectations are for 65 Bcf build-in stockpiles, according to survey provider Estimize.

Technical Analysis

Natural gas prices moved higher lower on Wednesday after testing resistance levels and failing. Target resistance is seen near the February highs at 3.06. Short-term resistance is seen near an upward sloping trend line that comes in near 2.98. Support is seen near the 10-day moving average at 2.91. The 10-day moving average crossed above the 50-day moving average, which means that a medium-term uptrend is now in place. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal. Medium-term momentum is positive but decelerating as the MACD (moving average convergence divergence) histogram prints in positive territory with a sliding trajectory which points to consolidation.

The total supply of natural gas remains mostly flat. According to data from the EIA, the average total supply of natural gas rose slightly by 0.3% compared with the previous report week. Dry natural gas production grew by 0.9% compared with the previous report week. Average net imports from Canada decreased by 9.5% after a large increase last week. Net imports from Canada averaged 4.7 Bcf per day this week compared with 5.1 Bcf per day last week.

Gold Forecast – Gold Prices Breaking Out Above $1800 Confirming Next Up leg

Gold is above $1800 and confirmed last week’s outlook for a crucial 40-day cycle low. Prices remain on track for a retest of the $2000 level by July. The next 40-day low is not due until late June, so we see plenty of room for upside near-term.

GOLD FUTURES DAILY: The mid-term gold cycle bottomed on day 37, and prices are just 5-days into a new upswing. With futures clearly above $1800, the uptrends in metals in mines should begin to accelerate.

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Note- The 40-day cycle in gold bottomed on day 37 – slightly early but not surprising given the previous cycle extended to 41-days. On average, we see cyclical turning points about every 39-days.

GOLD MINERS (GDX): After an agonizing 7-month decline, gold miners formed a major bottom in March. In fact, we believe GDX may never return to the $30.00 level again for the remainder of this 10-year bull market.

Currently, miners are attacking the April high ($36.83) and the all-important 200-day MA ($36.99). Once prices push above $37.00, then I think there is a good chance shorts will begin to cover, and we could get the 5%+ bullish recognition day I’ve been expecting. Prices overwhelmingly confirmed last week’s 40-day cycle low, and we are only 4-days into a new upcycle.

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bullish recognition day is when the market suddenly acknowledges a trend change. Traders that were still looking lower get caught on the wrong side and frantically begin to cover. In GDX, this usually looks like a robust 5%+ up day on big volume.

We see tremendous value in high-quality gold producers. These miners are minting money (real money – not Dogecoin) and are incredibly undervalued, in our opinion. Our favorite producer currently is Kirkland Lake.

Silver and platinum are also primed and could explode higher over the coming weeks. Our Premium Metals Portfolio has been accumulating quality miners throughout the pullback and is well-positioned for this next advance.

AG Thorson is a registered CMT and expert in technical analysis. He believes we are in the final stages of a global debt super-cycle. For more information, please visit here.

For a look at all of today’s economic events, check out our economic calendar.

USD/CAD Daily Forecast – Test Of Support At 1.2200

USD/CAD Video 06.05.21.

U.S. Dollar Is Under Strong Pressure Against Canadian Dollar

USD/CAD is currently trying to settle below the support at 1.2200 while the U.S. dollar is losing ground against a broad basket of currencies.

The U.S. Dollar Index is currently testing the support at the 91 level. If the U.S. Dollar Index declines below this level, it will move towards the support at 90.70 which will be bearish for USD/CAD.

Today, U.S. reported that Initial Jobless Claims decreased from 590,000 (revised from 553,000) to 498,000 while Continuing Jobless Claims increased from 3.65 million (revised from 3.66 million) to 3.69 million.

Tomorrow, foreign exchange market traders will have a chance to take a look at additional employment data from U.S. and Canada. In the U.S., Non Farm Payrolls report is expected to show that U.S. economy added 978,000 jobs in April. Unemployment Rate report is projected to indicate that Unemployment Rate declined from 6% to 5.8%.

In Canada, Employment Change report is expected to show that Canadian economy lost 175,000 jobs in April. Unemployment Rate is expected to increase from 7.5% to 7.8%.

Technical Analysis

usd cad may 6 2021

USD to CAD managed to settle below the support at 1.2250 and gained strong downside momentum. Currently, USD to CAD is testing the next support level which is located at 1.2200. RSI moved into the oversold territory, but USD to CAD may gain additional downside momentum in case the right catalysts emerge.

If USD to CAD settles below the support at 1.2200, it will move towards the next support level at 1.2170. A successful test of the support at 1.2170 will open the way to the test of the support at 1.2130.

On the upside, USD to CAD needs to stay above 1.2200 to have a chance to develop upside momentum in the near term. The next resistance level for USD to CAD is located at 1.2250.

If USD to CAD gets above this level, it will move towards the resistance at 1.2280. A move above this level will open the way to the test of the resistance at 1.2310.

For a look at all of today’s economic events, check out our economic calendar.

S&P 500 Price Forecast – Stock Market Continues Sideways Behavior

The S&P 500 initially tried to rally during the course of the trading session on Thursday but then gave back the gains to start falling again. Quite frankly, there are lot of mixed messages out there when it comes to the economy in the stock market went forward, but at the end of the day we are still very much in an uptrend and it is worth paying attention to. The 4100 level underneath should offer support, as it has over the last couple weeks. That being said, there is even more support underneath at the 50 day EMA and of course the 4000 level. With that being said, I think that if we get some type of selling pressure, then we will get long again based upon some type of bounce.

S&P 500 Video 07.05.21

To the upside, I see the 4200 level as a major barrier that needs to be overcome with some type of catalyst. We are in the midst of earnings season and it has gone fairly well but quite frankly the market had already priced all that in. Because of this, I think that we will continue to see a “buy on the dips” type of mentality, as we continue to find plenty of narratives out there to push this market higher. Central banks around the world will continue to flood the markets with liquidity, thereby having people push money into stock markets yet again. I see no scenario in which a willing to start shorting this market anytime soon.

For a look at all of today’s economic events, check out our economic calendar.

Silver Price Forecast – Silver Markets Continue Bullish Pressure

Silver markets initially drifted a little bit lower during the trading session on Thursday but then broke higher to reach towards the $27.35 level. The market certainly looks as if it is on its way to the $28 level, but it is obvious that the market has a lot of noise involved in it. After all, the silver markets do tend to be very choppy to say the least, so it does make quite a bit of sense that we would continue to see volatility. With that being the case, the market is likely to continue seeing short-term pullbacks as potential buying opportunities and of value.

SILVER Video 07.05.21

Underneath, we have the 50 day EMA sitting at the $26 level, and that could of course attract a lot of support and buyers get involved. If we break down below the $26 level, it could open up a move down to the 200 day EMA underneath. We are in an uptrend, there is nothing on this chart that tells us that we should be looking for buying opportunities only, and a break above the $28 level would open up the possibility of a move to the $30 level. All things been equal, I do think that we get there and perhaps even higher as we continue to play the “reflation trade.” Silver has a major industrial component built into it, so it certainly makes a bit of sense that we would be looking at a “buy on the dips” type of scenario. I have no interest whatsoever in shorting this market, as we have such bullish pressure and of course a huge fundamental driver of price.

For a look at all of today’s economic events, check out our economic calendar.

Crude Oil Price Forecast – Crude Oil Continue to Pressure Upside

WTI Crude Oil

The West Texas Intermediate Crude Oil market has pulled back a bit during the trading session on Thursday, as we sit right at the $65 level. The $65 level of course is a large, round, psychologically significant figure that would attract a certain amount of attention, but part of what has caused the market pull back a bit is that the demand for gasoline in the United States has fallen for the second week in a row. That being said, the ascending triangle that formed previously does suggest that we have more upward pressure going on than down, as we have been in an uptrend anyway. If we do pull back from here it is likely that we would see plenty of support at both the 50 day EMA and the uptrend line that has been part of that ascending triangle.

Crude Oil Video 07.05.21

Brent

Brent markets also look very much the same as you would expect, after forming the same kind of ascending triangle. The $70 level above does offer a certain amount of psychological resistance, so if we can break above there then it is likely that the market would continue to go much higher. A lot of this comes down to the “reopening trade” that a lot of people pay close attention to, so therefore it does make a certain amount of sense that value hunters will be looking to get involved. Once we can clear the $70 level on a daily close, it is very likely that we go much higher, perhaps making a move towards the $72.50 level initially, followed by a move to the $75 level. I have no interest in shorting the market anytime soon.

For a look at all of today’s economic events, check out our economic calendar.

Silver to $300

No, I haven’t lost my mind. After all, it’s a metal that’s known for massive rallies.

You see, when silver went trough its 1970s bull market, it started from a low of $1.31 in October 1971. By the time it reached its peak in 1980, silver had run all the way up to $49. That was a 37x return.

If we consider that silver was priced at $4.20 in late 2001, a 37x return would take it to about $155. However, I think this bull market could be an order of magnitude larger for a number of reasons, the main ones being debt, credit and money printing.

As a result, I think silver’s ultimate peak could be $300, and I won’t rule out possibly even higher.

Bullish Silver Fundamentals

Most developed and many developing nations have been in multi-year or even multi-decade deficit scenarios. This now looks to have become a permanent state, at least until we reach some sort of global financial reset.

The Institute of International Finance explains how the COVID-19 pandemic response added $24 trillion to the global debt mountain last year, to reach a new all-time record high of $281 trillion.

And interest rates being maintained at 5,000-year lows will only encourage more debt. Couple that with many countries borrowing to meet interest payments, and central banks soaking up much of that new sovereign debt, and inflation havens like precious metals gain strong appeal.

Silver in particular has the added benefit of 50% of its demand being industrial. With unprecedented economic stimulus programs, many favoring green energy, silver is uniquely positioned to profit. What’s more, according to Metals Focus, silver supply was down 4% in 2020 by 42M ozs. According to the Silver Institute, total supply will rise by 8% this year, though total demand will rise nearly twice as much, by 15%, led by industrial, jewelry and physical demand.

So the fundamental side of silver demand is looking strong, but the technical side is also very bullish.

Bullish Silver Technicals

Let’s consider the gold silver ratio.

As a quick refresher, the gold silver ratio is calculated by simply dividing the spot price for one gold ounce by the spot price of one silver ounce. That’s it. Naturally the higher the ratio, the more silver ounces are needed to buy one gold ounce, and vice versa. The most bullish scenario is when the ratio is falling from a high level, ideally from above 80, and the silver price is rising.

Here’s a chart of the gold silver ratio during the 1970s silver bull market.

To me it’s very intriguing to note how recessions, which are the grey vertical bars, tended to mark troughs and/or peaks in the ratio. What’s also interesting is that when silver reached its peak in 1980, the gold silver ratio ultimately bottomed around the same time at a level near 15, which was below the starting point near 20.

Let’s now move to the current silver bull market which I believe began in 2001. The following chart shows us silver prices since 2000, not adjusted for inflation.

Of course, silver had a tremendous run from $4.20 in 2001 to its 2011 peak at $49. It then corrected until late 2015, then moved sideways until bottoming near $12 last year in March. It had a tremendous move up to $30 within just 5 months and has been mostly consolidating since.

Now let’s examine the gold silver ratio action since 2001.

Again we see peaks and troughs tend to occur (though not exclusively) around recessions (grey bars). At silver’s peak in 2011, the ratio bottomed near 33. It then rose almost constantly up to its all-time peak last March at 125, then fell dramatically to its current level around 67, as silver started to significantly outpace gold. Consider that we know from history silver always outperforms gold in precious metals bull markets. So the current action is particularly exciting for silver.

Silver Targets

But what does it all mean for how high the silver price can go? Of course, no one knows for sure. But there are some indicators worth examining for clues and suggestions.

I believe the ratio will ultimately reach a low near 15. And given the inflationary path we’re on, I think gold could peak at $5,000 per ounce. That’s just 2.5 times last August’s peak near $2,000. In fact, I think there’s even a decent chance gold could reach $10,000, which is just 5 times last August’s peak. But if we stick with $5,000, and an ultimate bottom in the gold silver ratio of 15, we get ($5,000/15) $333 per ounce of silver.

Let’s look at silver price targets from another angle: inflation.

If we consider inflation-adjusted silver prices going back to 1970, we see that the peak reached in 1980 was actually $120/ounce in today’s dollars, and that’s using government sanctioned inflation statistics, which tend to be well below what we experience in everyday life.

Considering the old way of calculating inflation, which the U.S. abandoned decades ago and I reference below from Shadowstats.com, a realistic inflation rate would have averaged 7% – 8% since 1980 (triple official inflation), which would mean an equivalent silver price of $240-$360 dollars at the 1980 peak.

My gold silver ratio target for silver of $333 is comfortably within the range of $240-$360. If we take the mid-way point between $240 and $360, we get $300. I think that’s as good an estimate as any of where silver can peak in its current bull market.

On this basis, the silver price would need to be up by more than 10x from current levels to reach its ultimate high. Imagine for a moment, if silver were to soar tenfold from here, what the silver producers’ and silver explorers’ share prices would do. It’s not difficult to expect simply spectacular returns. Which is exactly why it’s so attractive to allocate to this space, while being diversified across several stocks, as it’s impossible to know which will do best. Still, odds are very good that if silver goes up by a factor of 10, the average silver stock should easily double that, and be up by a factor of 20, while the most successful juniors could gain 50x or more. That would simply be a repeat of previous bull markets.

Larger silver producers and royalty companies should be seen as core positions to be held for the long term. The more junior explorers should be treated more cautiously as speculations, on which to take profits when they materialize. Selling half of one’s position on a double would be especially sensible.

In any case, I believe it remains early days for silver and silver stocks. I expect to see much higher prices ahead in the metal and the equities. And in my view the current bout of weakness is an opportunity to buy or add to positions in this space. Remember, at $26 silver is still nearly 50% below its all-time nominal high, while gold is just 10% below its all-time nominal high. Silver is clearly the better relative bargain.

In the Silver Stock Investor newsletter, I provide my outlook on which silver stocks have the best prospects as this bull market progresses. Many offer 5x to 10x return potential in just the next few years, especially as silver heats up.

I think silver is currently at or very close to its bottom, but that its ultimate peak could well be in the $300 range.

Either way, silver is headed much, much higher.

For a look at all of today’s economic events, check out our economic calendar.

Natural Gas Price Forecast – Natural Gas Markets Sit Sideways

Natural gas markets have gone back and forth during the course of the trading session on Thursday as we continue to look at the $3.00 level as massive resistance. That is an area that has been difficult for some time, and it should continue to be. Quite frankly, I think this is a market that will see a lot of choppy volatility, but it looks as if we are running out of momentum. The market breaking above the $3.00 level still faces a lot of noise based upon historical behavior, and of course psychological resistance.

NATGAS Video 07.05.21

Given enough time, I fully anticipate that this market will start to fall, perhaps trying to drop down to the $2.75 level initially, followed by the gap underneath it has yet to be filled. After all, we are going to be getting warmer temperatures in the northern hemisphere soon, despite the fact that it has been cooler than usual. With that being said, there will be less demand for natural gas, in a market that is already oversupplied. There has been an uptick in foreign demand for liquefied natural gas, but at this point in time it will be enough to change the market dynamics.

Commodities in general have been getting a bid, so natural gas has become overvalued. I think eventually the fundamentals come back into play and we fall apart. With this, I like the idea of selling at the first sign of a breakdown, because we have such a significant and obvious round figure just above the use as a barrier to determine which direction, we are going in. All things been equal, the spring temperatures will start to overtake the market.

For a look at all of today’s economic events, check out our economic calendar.

Gold Price Forecast – Gold Markets Break 200 Day EMA

Gold markets have broken higher during the course of the trading session on Thursday as we have cleared the 200 day EMA and the $1800 level. At this point, the market is likely to continue going higher, perhaps reaching towards the $1850 level, and then after that the $1950 level. This of course is a market that has recently formed a bit of a “double bottom”, and that suggests that it has much further to go. It is interesting, because gold has disappeared from the inflation argument until recently, but now it appears that the traders finally starting to kick in.

Gold Price Predictions Video 07.05.21

To the downside, I see the 50 day EMA as offering support, and most certainly the $1750 level will as well. It is not until we break down below there that I would be concerned, but after the action that we have seen during the day on Thursday, it is very likely that the buyers will continue to push to the upside. The size of the candlestick is somewhat impressive, and therefore it looks like there is serious conviction in this market. If the US dollar continues to fall, that should continue to lift gold in general, and therefore I think that we have a “buy on the dips” type of mentality from short-term traders. Ultimately, this will be a very noisy move to the upside, but it certainly looks as if we have made major changes in attitude during the day, as we have been building up pressure for some time. I have no interest in shorting this market until we close below the $1750 level, something that does not look as likely now.

For a look at all of today’s economic events, check out our economic calendar.

Why Shares Of Moderna Are Down By 5% Today?

Moderna Video 06.05.21.

Moderna Stock Moves Lower As Q1 Revenue Misses Estimates

Shares of Moderna found themselves under pressure after the company released its first-quarter results.

Moderna reported revenue of $1.94 billion and earnings of $2.84 per share, beating analyst estimates on earnings and missing them on revenue. It looks that the market was not ready to tolerate the revenue miss, and it weighed heavily on Moderna stock.

The bar was set high for the company whose shares were up by more than 60% year-to-date before the release of the quarterly report. In addition, shares of  vaccine makers found themselves under pressure after U.S. signaled that it would support a waiver for vaccine IP rights at the WTO.

EU has already stated that it was ready to discuss waving COVID-19 vaccines patents, which is a worrisome development for investors. At the same time, it remains to be seen whether any decisions will be made in the near term.

What’s Next For Moderna?

The sell-off in Moderna shares was triggered by IP waiver-related fears and a revenue miss. IP waiver-related fears probably served as the main catalyst for the current sell-off as other vaccine makers like BioNTech and Pfizer also found themselves under pressure.

Currently, analysts expect that Moderna will report earnings of $23.27 per share in 2021 and $16.58 per share in 2022 so the stock is trading at about 9 forward P/E for 2022 which is very cheap in today’s market environment.

However, there is a lot of uncertainty regarding future profits, and recent discussions about waiving IP rights add another layer of uncertainty. At the same time, it looks increasingly likely that at least some part of the vaccine revenue will be recurring as people may need regular shots to protect themselves against COVID-19.

In this light, Moderna shares may soon attract speculative traders and investors who will want to use the current pullback as an opportunity to buy the stock at lower levels.

For a look at all of today’s economic events, check out our economic calendar.

Gold & Silver Begin New Advancing Cycle Phase

Before going into detail regarding my latest research and cycle phases, I want you to think of these cycle phases as Advancing and Declining cycle trends.  They act as a “build-up of trend”, then an “unwinding of trend”.  In each instance, trends can be either Bullish, Bearish, or Neutral in nature.  My research team and I believe a new Bullish Cycle Phase has begun in Gold and Silver.  If our research is correct, the next Advancing Cycle Phase may prompt a broad rally in Gold and Silver.

Understanding Cycle Phase Analysis & Trends in Metals

We interpret these cycle phases as unique trend segments involved in a broader cycle scope.  For example, over a longer-term rally, we may see many Bullish Advancing and Declining cycle phases take place – one after another.  Conversely, we may see many Bearish cycle phases take place in an extended downtrend.  Another type of cycle phase can also exist, the Reversal Cycle Phase – where price Advances in one direction and Declines in the opposite direction.  This type of Rotation Cycle Phase exists as the current completed Cycle on the Gold chart, below.

As we are nearing the end of the current Declining Cycle Phase as seen in the chart below, we will soon begin the new Advancing Cycle Phase in Gold.  Gold’s Reversal Cycle Phase that took place between December 21, 2020, and May 10, 2021, will likely close higher than the midpoint (or Apex) of the total Cycle Phase.  This suggests a new bullish price trend has taken over and the price is more likely to move higher in the next Advancing Cycle Phase. If this trend continues, then the price will continue to rally higher in the Declining Cycle Phase as well – as we saw in the first Cycle Phase: between March 16, 2020, and August 3, 2020.

Gold & Silver Phase Tables – Will Price Continue A New Bullish Cycle Phase?

To help explain our Cycle research, we’ve put together these tables to detail the Cycle Phases and price logic we use to interpret each Advancing and Declining phase.  Each table entry consists of an Advancing, then Declining Cycle Phase.  Combined, they make up a complete Cycle Phase.  We are measuring price at the midpoint (Apex) of the Cycle Phase to determine if any Advancing or Declining Cycle Phase is Bullish or Bearish in trend.  If both Advancing and Declining Cycle Phases show the same trend direction, we define that completed Cycle Phase as Bullish or Bearish.  If they differ in trend types, we define that completed Cycle Phase as a Reversal Phase.

Gold has been in a downtrend recently while Silver has continued to stay somewhat bullish in a sideways price trend.  You can see from the tables below, Gold recently completed a Reversal Cycle Phase (ending with a Bullish Declining Phase) while Silver has continued to exhibit Bullish Cycle Phases since March 9, 2020.

Both Gold and Silver ended their last completed Cycle Phases recently.  Gold will end the last completed Cycle Phase on May 10, 2021.  Silver ended its last completed Cycle Phase on April 12, 2021. The next Advancing Cycle Phase for both Gold and Silver will begin this week and next week – and will continue until July 19, 2021.  After that, the Declining Cycle Phase will begin and last until late September, for Gold, and late October for Silver.

If our research is correct, we may see extended bullish trending over the next 6+ months in both Gold and Silver.

Silver Cycle Phases Continue To Show Stronger Bullish Trending

The following Silver Weekly Chart highlights the Cycle Phases and highlights the price trends for each Advancing and Declining Cycle Phase.  While Gold has experienced an extended Bearish Cycle Phase over the past 5+ months, Silver has continued to show stronger bullish price Cycle Phases and continues to attempt higher closing price levels at the end of each Cycle Phase.  We believe this suggests Silver is likely to see some explosive upside price trending when the $28.42 level (the higher YELLOW line) is breached.  This level represents historical price resistance for Silver.  Once this level is breached, we believe Silver will begin to advance higher very quickly.

Remember, we have until July 19, 2021, before the first Advancing Cycle Phase in Silver ends.  This Advancing Phase may prompt a move above the $28.42 level and may attempt to rally above $30.00 as we have drawn on the chart (below). If the Declining Cycle Phase continues this bullish trend, we may see Silver trading above $32.00 ~ $33.00 before Halloween 2021.  This would represent a +26.5% rally in Silver from the last completed Cycle Phase price level.

In closing, we want to suggest that a rally as we are proposing in Gold and Silver will also present a renewed risk factor for the US and global markets (potentially). In the past, we have seen precious metals rally while the US stock market rallies.  It is not uncommon for precious metals to begin to move higher while the US stock market continues to move higher.  This type of price activity simply suggests that global traders/investors are moving capital into Precious Metals as the US stock market climbs a strengthening “wall of worry”.  This type of price action happened from 2004 to 2009 – prior to the Credit Crisis/Housing Crisis.

As we’ve been suggesting for many months, the next few years are going to be full of incredible opportunities for traders and investors. Smart traders will quickly identify these phases of the market and will understand how to position themselves to take advantage of this next phase. You can learn more about how I identify and trade Gold, Silver, and the markets by watching my FREE step-by-step guide to finding and trading the best sectors.

For those who believe in the power of trading on relative strength, market cycles, and momentum but don’t have the time to do the research every day then my BAN Trader Pro newsletter service does all the work for you with daily pre-market reports, proprietary research, and trade alerts. More frequent or experienced traders have been killing it trading options, ETFs, and stocks using my BAN Hotlist ranking the hottest ETFs, which is updated daily for my premium subscribers. Sign up today!

For a look at all of today’s economic events, check out our economic calendar.

Happy Trading!

Chris Vermeulen
Founder & Chief Market Strategist
www.TheTechnicalTraders.com

Silver Price Daily Forecast – Resistance At $27.50 In Sight

Silver Video 06.05.21.

Weak Dollar Provides Support To Silver

Silver gained upside momentum and managed to get above the resistance at $27.00 while the U.S. dollar remained under pressure against a broad basket of currencies.

The U.S. Dollar Index failed to settle above the resistance at the 20 EMA at 91.30 and is testing the support at the 91 level. In case the U.S. Dollar Index declines below this level, it will move towards the support at 90.70 which will be bullish for silver and gold price today. Weaker dollar is bullish for precious metals as it makes them cheaper for buyers who have other currencies.

Gold is currently testing the resistance at the $1800 level. In case gold manages to settle above this level, it will head towards the resistance at $1820 which will be bullish for silver.

Gold/silver ratio managed to get below the 67 level and is trying to settle below 66.50. If gold/silver ratio declines below this level, it will move towards the 66 level which will be bullish for silver.

Technical Analysis

silver may 6 2021

Silver managed to get above the resistance at $27.00 and is trying to gain additional upside momentum. If silver settles above this level, it will move towards the resistance at $27.50. RSI remains in the moderate territory, and there is plenty of room to gain additional upside momentum in case the right catalysts emerge.

A successful test of the resistance at $27.50 will push silver towards the next resistance level at $27.75. If silver gets above the resistance at $27.75, it will head towards the next resistance which is located at $28.30.

On the support side, a move below the $27 level will push silver towards the support at $26.65. In case silver declines below this level, it will head towards the support at $26.30.

A successful test of the support at $26.30 will push silver towards the support which is located at the 20 EMA at $26.15. In case silver manages to settle below this level, it will head towards the next support at the 50 EMA at $25.95.

For a look at all of today’s economic events, check out our economic calendar.

American Indices Moving in Opposite Directions

American Indices are currently moving in opposite directions. The tech-heavy NASDAQ index is going down, aiming for the long-term up trendline while the old-school Dow Jones flirts with all-time highs after the price escaped from the pennant formation.

The German Dax is trading inside a flag formation, which is promoting a long-term breakout to the upside.

Gold is aiming higher after a successful bounce from the 1760 USD/oz support.

The USDCAD broke the lower line of the channel down formation, which should be considered an extreme weakness.

The AUDCHF tested the lower line of the symmetric triangle pattern. A breakout to the downside is very probable.

The ZARJPY shot higher after a false bearish breakout from the Head and Shoulders formation.

The EURPLN is aiming higher after a very handsome bullish engulfing pattern on the daily chart.

The USDHUF dropped like a rock after the price created a shooting star on the daily chart, which bounced from a combination of dynamic and horizontal resistances.

For a look at all of today’s economic events, check out our economic calendar.

 

USD/JPY Price Forecast – US Dollar Rallies Heading Towards Jobs Figure

The US dollar initially pulled back slightly during the course of the trading session on Thursday but then turned around to show signs of strength as we reached towards the ¥109.50 level yet again. At this point, it looks as if we are trying to go looking towards the ¥110 level. Keep in mind that Friday is the Non-Farm Payroll announcement, and that of course is going to continue to be influential as to where we go. Ultimately, this is a bullish run and we recently bounced from the 50 day EMA as well as the 38.2% Fibonacci retracement level that of course is a very positive sign.

USD/JPY Video 07.05.21

If we can break above the ¥110 level, then it is likely that we go looking towards the ¥111 level, which was the recent high. If we can break there, then we have a much longer term run higher. On the other hand, we could very well go back and forth in this general vicinity and simply grind. All things been equal, I have no interest in shorting this market until we break down below those hammers that caused the bounce in the first place. In general, this is a market that is very strong, but certainly will be waiting to see what the jobs number has to say. I would anticipate quite a bit of volatility during the trading session on Friday, as the market will probably have to readjust its expectations depending on whatever number comes out. There are wide and varied expectations for the figure coming out, so I anticipate more chaos than anything else.

For a look at all of today’s economic events, check out our economic calendar.

GBP/USD Price Forecast – British Pound Has Noisy Day as MPC Announces Tapering

The British pound has gone back and forth during the trading session on Thursday as the Monetary Policy Committee has come and gone, suggesting that tapering is coming in the bond market. That of course is bullish for the British pound, but at the same time we have been locked in a lot of support and resistance in this general vicinity.

GBP/USD Video 07.05.21

When you look at the 50 day EMA, has offered a bit of support as of late, so that is something worth paying attention to. Furthermore, we have the double bottom underneath there that continues to support the market as well. It is not until we break down below there that I think we could start to see the first “cracks in the ice” of the uptrend but if you are a seller, you then need to worry about the 1.35 level underneath which is attracting the 200 day EMA. Underneath there, then obviously the trend is done.

To the upside, the 1.40 level continues to be like a “brick wall for the market” and breaking above there on a daily close would be a massively bullish sign. In the short term, I think we simply go back and forth in the fact that we have the jobs number coming out on Friday certainly makes quite a bit of sense. Ultimately, this is a market that is been very volatile for the session, but it seems to have been little changed. Interesting to see this reaction, but at the end of the day I think people almost immediately turn their attention on the employment situation in America.

For a look at all of today’s economic events, check out our economic calendar.

GBP/JPY Price Forecast – British Pound Very Noisy

The British pound has initially pulled back a bit during the course of the trading session on Thursday but turned around to show signs of strength again as the Bank of England is suggesting that they will be tapering bond purchases, which is a form of monetary policy tightening. This follows the Bank of Canada, as we are starting to see central banks try to get ahead of the reopening trade.

GBP/JPY Video 07.05.21

The Japanese yen continues to get beaten up, and that of course will not be any different here. The ¥150 level underneath is rather significantly supported, not only due to the fact that we have seen a bit of a bounce from there, but we have also seen the 50 day EMA coming into the picture. With that being the case, I think it is only a matter of time before buyers will come back into this market if we reach down towards that area.

On the other hand, it looks much more likely that we are going to go looking towards the ¥153.50 level, and then possibly reaching towards the ¥155 level. This is a market that has been in a very bullish move over the last several months, and now we are simply grinding back and forth in order to try and pick up more momentum while working off froth. Eventually, I anticipate that the buyers will continue to look it dips as value in a market that has been obviously one way for quite some time. I anticipate that the Friday market might be a little bit quiet ahead of the jobs number but if we get a good number out of the United States, we may get more “risk on behavior”, sending this pair higher.

For a look at all of today’s economic events, check out our economic calendar.

EUR/USD Price Forecast -Euro Bounces From Major Figure

The Euro has bounced from the 1.20 level to show signs of strength again during the Thursday session. This front run the jobs number coming out of America so it will be interesting to see how this plays out. I do think that there is a little bit of resistance just above that could cause some issues, but at the end of the day we are in an uptrend and you could even make a little bit of an argument for a bullish flag or on shorter time frames a falling wedge.

EUR/USD Video 07.05.21

It is obvious that the 1.20 level would catch a lot of attention, and of course the 50 day EMA sitting there makes quite a bit of sense as far as support goes as well. With all of that in mind I think that what we are looking at is the possibility of a move back towards the highs that we made a couple of weeks ago. Ultimately, I think that this remains a short-term “buy on the dip” type of market, but if we were to break down below the 50 day EMA, perhaps after the jobs figure, then we will more than likely go looking towards the 200 day EMA underneath.

Remember, this pair does tend to be very choppy and sideways most of the time so although it is grinding higher, you will probably find more value buying the Euro against other currencies. In the short term though, the US dollar is on its back foot and as long as that continues to be the case in general, that will lift this pair and perhaps send it towards the 1.23 handle.

For a look at all of today’s economic events, check out our economic calendar.

AUD/USD Price Forecast – Continues to Build Up Pressure to the Upside

The Australian dollar initially pulled back during the course of the trading session on Thursday to reach down towards the 50 day EMA. Ultimately, it looks as if the market is trying to build up enough momentum to finally break above the 0.78 handle, which of course is the massive resistance barrier that the market has been fighting for some time. All things been equal, the market breaking above there could open up the possibility of a move to the 0.80 level given enough time. That of course is an area that is important from a longer-term standpoint, as you can see it clearly as resistance on the monthly chart.

AUD/USD Video 07.05.21

Ultimately, if we can break above that 0.80 region of resistance, this market will go much higher. It would then become a “buy-and-hold” situation, but overnight China decided that they were going to end all discussions involving trade with the Australians, so there was a little bit of a selloff that lasted just a short amount of time. Ultimately, the commodity boom should continue to lift the Australian dollar over the longer term, but obviously we have a lot of noise to deal with. The last couple of months have been very difficult, and it appears that we have more of the same ahead of us.

That being said, if we were to turn around and break below the 0.76 level it is likely that we could go looking towards the 0.75 level. If we break down below that handle, then I believe that the Australian dollar probably needs to “reset” closer to the 0.70 level which of course is an area that will attract a lot of attention due to the psychological importance of it.

For a look at all of today’s economic events, check out our economic calendar.