We could slowly be rounding up form the bottom in both GLD and SLV. Its still to early to tell as we are just taking out the 2nd fanline in both. GLD broke out of a bullish falling wedge back in May and was able to stay above the top rail without making a lower low, lower than the low in the falling wedge, which was very positive. My experience with falling wedges is that if the wedge is for real we won’t make a new low, lower than the low within the wedge. On occasion these wedges can take sometime before they actually fulfill their price objective which can be frustrating at times.
If we are working out a 3 fanline scenario, in both GLD and SLV, it will be more of a grinding move up instead of a fast move until we break thru the 3rd fanline with a backtest. After the last backtest the real move will begin which will be much different than the 2 steps forward and 1 step backwards we were used to. I’ve labeled the 2 fanlines we have right now as F1 And F2 on the chart below. Note: If we start to trade back below the current fanline for a period of time, all bets are off.
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SLV has the same thing going on as GLD. We popped up through the 2nd fanline today and we are testing that 2nd fanline from the topside as we speak. The real thing to watch with SLV is the top red rail of the expanding falling flag. If we can take out that top rail we will have taken out 3 previous highs which would be extremely bullish IMHO. Again, I think we will get a slow, grinding up type move until we can take out some of the overhead resistance above the top red rail.
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As far as the juniors go, they are still weak and in some cases getting weaker. So hard to believe with the price of gold and silver at the levels they are at.
All the best to you Fully…Rambus