Monday was a rough day for energy and precious metals. Oil has now closed lower 9 out of the past 10 Mondays. As mentioned yesterday, energy markets were hit by Goldman Sachs saying natural gas is a short. Besides energy, gold and silver demand your attention.
The chart below shows a possible scary situation for gold. After reaching a daily high of $1532, the spot price of gold closed at $1517. As you can see, recent action in gold prices have caused the uptrend to be broken. Further cause for concern, is the possible head and shoulders formation that has developed in June. Although we still recommend holding some gold in your portfolio, it looks as if gold is getting ready to test support levels, and become rangebound for the summer. Gold becoming rangebound is nothing new for our Gold & Silver Newsletter subscribers.
The chart below also shows a concern for silver mounting. Silver had trouble gaining any steam on Monday, and even reached a low of $34.56. Although silver bounced back to close at $35.07, the chart shows a possible tipping point coming soon. The price action in silver is breaking below the bottom pennant line, which can be very bearish. It will be important for investors to monitor this situation and see if silver can keep bouncing off support levels.
ETFs such as the EFTS Physical Silver Shares iShares Silver Trust and ProShares Ultra Silver fell. Miners such as First Majestic Silver, Endeavour Silver, Goldcorp, and Barrick Gold also failed to shine on Monday.
However, Great Panther Silver managed to jump nearly 8% on Monday as The Monthly Fool classified the miner in its “Poised to Pop” category.
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