Technical Update - Correction in Gold, Silver and Copper unfolding. Here are the levels to look out for

Technical Update - Correction in Gold, Silver and Copper unfolding. Here are the levels to look out for

KCL
Kim Cramer Larsson

Technical Analyst, Saxo Bank

Summary:  A correction has been looming for a couple of weeks now in metals. Now it has started with Copper leading the selling pressure with Gold to follow. Silver still holding on - for now


Today's Saxo Market Call podcast.
Today's Market Quick Take from the Saxo Strategy Team

Gold XAUUSD
formed a Bearish Engulfing top and reversal pattern a couple of days ago warning of a likely correction. Divergence on RSI supports this likely scenario.
Now the correction seems to be unfolding. Gold is set for a correction down to support at around 1,865 and the 0.382 retracement. However, selling pressure could intensify if Gold closes below 1,865 and a dip down to 0.618 retracement and strong support at around 1,808 could be seen.

For Gold to resume uptrend and cancel the bearish picture a close above 1,949 is needed. IT will pave the way for a move above 2K.

Medium-term. If Gold closes the week at current or lower levels the weekly chart will have formed an Evening Doji top and reversal pattern with a likely move down to around 1,808. 55 weekly SMA will offer some support.

Source all charts and data: Saxo Group

Silver XAGUSD. Bears finally seem to be taking control after the precious metal traded sideways out of its rising channel to trade in a wide range between 24.50 and 23.10. If Silver closes below 23 and below 55 daily SMA selling pressure is likely to increase pushing Silver down to support and 0.382 retracement around 22.04.
If closing below 22 further selling could push Silver down to the 200 daily SMA.
For Silver to resume uptrend a close above 24.50 is needed. If that plays out no resistance until around 25.85

Medium term Silver has fallen short of the strong resistance at around 25.85 but almost reached its potential target of the inverted Shoulder-Head-Shoulder pattern just below 25.
A correction down to test the SHS neckline and the 55 weekly SMA seems plausible. .

Copper. Uptrend has been showing weakness for a couple of weeks now drawing the picture of a correction picture. Support at 410. A close below is likely to further fuel a sell-off down to 0.618 retracement at 395. A dip down to test the lower rising trendline is not unlikely.

Medium-term Copper reached the 0.618 retracement of the Q2-Q3 2022 downtrend around 431. If the ongoing correction push Copper to close a week below its 55 weekly SMA selling pressure could remain for a bit longer before buyers come back in.

 

RSI divergence explained: When instrument price is making a new high/low but RSI values are not making new high/low at the same time. That is a sign of imbalance in the market and an weakening of the uptrend/downtrend. Divergence or imbalance in the market can go on for quite some time but not forever. It is an indication of an exhaustion of the trend

Quarterly Outlook

01 /

  • Equity outlook: The high cost of global fragmentation for US portfolios

    Quarterly Outlook

    Equity outlook: The high cost of global fragmentation for US portfolios

    Charu Chanana

    Chief Investment Strategist

  • Commodity Outlook: Commodities rally despite global uncertainty

    Quarterly Outlook

    Commodity Outlook: Commodities rally despite global uncertainty

    Ole Hansen

    Head of Commodity Strategy

  • Upending the global order at blinding speed

    Quarterly Outlook

    Upending the global order at blinding speed

    John J. Hardy

    Global Head of Macro Strategy

    We are witnessing a once-in-a-lifetime shredding of the global order. As the new order takes shape, ...
  • Asset allocation outlook: From Magnificent 7 to Magnificent 2,645—diversification matters, now more than ever

    Quarterly Outlook

    Asset allocation outlook: From Magnificent 7 to Magnificent 2,645—diversification matters, now more than ever

    Jacob Falkencrone

    Global Head of Investment Strategy

  • Macro outlook: Trump 2.0: Can the US have its cake and eat it, too?

    Quarterly Outlook

    Macro outlook: Trump 2.0: Can the US have its cake and eat it, too?

    John J. Hardy

    Global Head of Macro Strategy

  • Equity Outlook: The ride just got rougher

    Quarterly Outlook

    Equity Outlook: The ride just got rougher

    Charu Chanana

    Chief Investment Strategist

  • China Outlook: The choice between retaliation or de-escalation

    Quarterly Outlook

    China Outlook: The choice between retaliation or de-escalation

    Charu Chanana

    Chief Investment Strategist

  • Commodity Outlook: A bumpy road ahead calls for diversification

    Quarterly Outlook

    Commodity Outlook: A bumpy road ahead calls for diversification

    Ole Hansen

    Head of Commodity Strategy

  • FX outlook: Tariffs drive USD strength, until...?

    Quarterly Outlook

    FX outlook: Tariffs drive USD strength, until...?

    John J. Hardy

    Global Head of Macro Strategy

  • Fixed Income Outlook: Bonds Hit Reset. A New Equilibrium Emerges

    Quarterly Outlook

    Fixed Income Outlook: Bonds Hit Reset. A New Equilibrium Emerges

    Althea Spinozzi

    Head of Fixed Income Strategy

Content disclaimer

None of the information provided on this website constitutes an offer, solicitation, or endorsement to buy or sell any financial instrument, nor is it financial, investment, or trading advice. Saxo Bank A/S and its entities within the Saxo Bank Group provide execution-only services, with all trades and investments based on self-directed decisions. Analysis, research, and educational content is for informational purposes only and should not be considered advice nor a recommendation.

Saxo’s content may reflect the personal views of the author, which are subject to change without notice. Mentions of specific financial products are for illustrative purposes only and may serve to clarify financial literacy topics. Content classified as investment research is marketing material and does not meet legal requirements for independent research.

Before making any investment decisions, you should assess your own financial situation, needs, and objectives, and consider seeking independent professional advice. Saxo does not guarantee the accuracy or completeness of any information provided and assumes no liability for any errors, omissions, losses, or damages resulting from the use of this information.

Please refer to our full disclaimer and notification on non-independent investment research for more details.


Business Hills Park – Building 4,
4th Floor, office 401, Dubai Hills Estate, P.O. Box 33641, Dubai, UAE

Contact Saxo

Select region

UAE
UAE

All trading and investing comes with risk, including but not limited to the potential to lose your entire invested amount.

Information on our international website (as selected from the globe drop-down) can be accessed worldwide and relates to Saxo Bank A/S as the parent company of the Saxo Bank Group. Any mention of the Saxo Bank Group refers to the overall organisation, including subsidiaries and branches under Saxo Bank A/S. Client agreements are made with the relevant Saxo entity based on your country of residence and are governed by the applicable laws of that entity's jurisdiction.

Apple and the Apple logo are trademarks of Apple Inc., registered in the US and other countries. App Store is a service mark of Apple Inc. Google Play and the Google Play logo are trademarks of Google LLC.