MontesDeOca said, “The gold and silver markets remain strong after fulfilling their intermediate objectives in the February time frame. Corrections continue to be shallow with no follow through, and with major buyers stepping up to the plate. We have completed 90- and 180-day cycles, but the price momentum continues to indicate that we could see a spike to the upside next week. With gold finally able to close above $1221 last week, it confirmed a multi-month bottom, while potentially finding an intermediate top that could take place next week.”
In the silver market, MontesDeOca said, “The downdraft last week reinforces the potential for an additional spike high into this week. This would also add confirmation to the new uptrend that is developing, which we anticipated in the later part of 2016.”
MontesDeOca explained that for silver, a daily close above $18.02 would reverse the weekly trend up with targets being activated in the $18.36 to $19.12 levels that correspond to a 50% Fibonacci target and a 61% target retracement of $19.12 of the total move that took place during the second half of 2016 when the market corrected since the highs made in August.
He said that gold’s resistance comes in “at the $1257 area which corresponds to a 50% Fibonacci retracement from the entire 2016 second-half decline.”
“This is a special update on the silver market,” MontesDeOca said, “that is validating the continuation pattern of this trend by testing these levels of support and finding a tremendous number of buyers, supporting a rally all the way up to about $18.50.” He said a close above $18.50 puts into play the 61.8% retracement in silver which is $19.12. “So any corrections in the silver market that occurred last week have been negated and the market is telling us that the continuation pattern is very bullish for the coming week.”
MontesDeOca concluded, “We should prepare to buy long in gold, and a close above $1239 will activate this upward signal of $1261. The silver market breaking through the $18.02 high would be a breakout to the upside. Buy into the weekly levels of the average in silver at the $17.83 level, which match the weekly levels of $17.80.”
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