HardAssetsInvestor

Written by Sumit Roy  |

April 17, 2012

Precious Metals Monitor: Gold Forms Rounded Bottom Ahead Of Likely Push To $1700, Palladium Ripe For Buying

Details

We offer our latest analysis on the precious metals market.

This past week featured more of the same for precious metals, as the sector consolidated in a narrow band. While most other risk assets — including other commodities — fell, precious metals held their ground.

However, the sector still lacks a strong catalyst to send prices meaningfully in either direction. Nascent worries about an economic slowdown and renewed concerns about eurozone-sovereign debt have not been enough to spur significant safe-haven buying in gold or silver.

That may change if market fears intensify; otherwise, gold and silver look poised to continue within their respective bottoming patterns.

Gold may be forming a rounded bottom. An eventual push to $1700 resistance is likely. Above that lies key resistance at $1800.

GOLD

The technical outlook for silver is not as constructive. The gray metal has been trapped between $31 and $33. A break to the downside exposes psychological support at $30, while an upside break may lead to a rally to key resistance near $35.

SILVER

Meanwhile, platinum and palladium showed divergent performance over the past week. The former is struggling under former-support-turned resistance at $1600. The next level of support lies at the 50 percent retracement of the December-to-February uptrend near $1540.

PLATINUM

A much more bullish case can be made for palladium, which successfully held the bottom of its channel during this recent correction. A potential rally to the top of the channel near $750 offers nimble traders a compelling profit opportunity.

PALLADIUM