Ahead of tomorrow’s U.S. Jobs Report and on the heels of some wild trading action in the past week in the gold and silver markets, today top Citi analyst Tom Fitzpatrick sent King World News an incredibly important pair of charts which show that gold and silver may now be setting up for major upside advances. Below are the 2 key gold and silver charts that all KWN readers around the world need to see along with Fitzpatrick’s comments.
Below is what Fitzpatrick had to say along with his 2 key charts:
When Gold got a weekly close below $1,180 – $1,182 in October it looked like a set up similar to the break in
April 2013 below $1,522-1,527 (see chart below).
Gold: Is it different than 2013?
However, unlike in that period, Gold has moved back decisively above the breakdown area (closing above it in 3 of the last 4 weeks)….
Continue reading the Tom Fitzpatrick piece below…
IF Gold closes this week over $1204.39 it will post a bullish outside week. The last time that happened was Dec 2013 – Jan 2014, when Gold ultimately bounced $210 low to high (over 17.2%). The same thing happened in May-June 2012, and saw it subsequently bounce $264 (17.7%).
A similar bounce this time, if seen, would target around $1,339-1,345 with good resistance, coincidentally, already in the $1,339-1,345 area.
So far it’s holding the Feb 2010 lows and possibly forming a bullish outside week (close this week over $16.73).
Such a close would suggest at least a re-test of the $18.20-$18.60 breakout area (see chart below).
Silver also looks to be finding good support
The bullish outside week seen in Dec 2013 saw a low to high bounce of 17.85%, while one in May 2013 saw a bounce of 31%. In July 2012 after the bullish outside week we saw a 33% bounce.
All this suggests a bullish outside week, if seen, could generate a rally to $17 to $19 in Silver.
KWN note: The way gold and silver close on Friday after the U.S. Jobs Report will answer the question.
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