Home Metals Gold tests the panic high; silver breaking out

Gold tests the panic high; silver breaking out

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The metals continue to surge, as gold tested the Jan. 8 overnight, silver may reverse, and platinum continues to run. This action can be either bullish or bearish, based on how the metals trade the next couple of days.

Gold and platinum are in a possible blow-off formation, which means that this breakout out should fail, followed by some consolidation, before resuming the rally. The higher volume and price action indicate a slight pullback is close; however, the pattern remains bullish.

Silver is in the process of breaking out although the pattern is the same — a blow-off formation. The key here is if the rally continues in silver, this may turn out to be a short-covering squeeze. However, a pullback that holds support at $18 basis March futures would indicate a breakout.

The next couple of days will be important in all of the metals, deciding the fate of the next big move. At this point, we remain bullish platinum and gold but neutral to bearish silver. Today could tell the story.

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