news.goldseek.com / By Rambus / Monday, 7 August 2017
There was some important price action in the Precious Metals Complex this past week as both gold and silver each tested important overhead resistance again. Always keep in mind that time is relative when it comes to the size of big patterns vs smaller patterns. When a multi year trendline is in place the breaking out and backtesting process can seem like it takes forever before you see some type of resolution to the pattern or trendline which has been the case with gold and silver recently.
Lets start with the long term weekly chart for gold we’ve been following for a long time now which shows its 2011 bear market downtrend channel. Almost exactly one year ago this month gold touched the top rail of its 2011 bear market downtrend channel at 1305 which held resistance. After a small decline gold once again rallied back up to the top rail of the 2011 bear market downtrend channel and failed once again. After another small decline gold has rallied back up to the top rail of the 2011 bear market downtrend channel which now comes in around the 1280 area.
I can count 9 touches now of the top rail so we know it’s very hot and to be respected. As I’ve mentioned on each of the previous hits to the top rail that it was up to the bulls to show us they were ready to take control away from the bears if they could take out that 6 year downtrend line. As you can see on this weekly chart for gold, now is the time for the bulls to step up to the plate and let the bears know they mean business. They can’t do it with talk, they need to show their strength.