Gold, Silver and Platinum reverse huge – By Todd Horwitz, Bubba Trading

 

2020-03-24

After being under heavy pressure for weeks the metals have had a major reversal overnight. The reversal stated on Friday when June Gold traded as low as 1460, Platinum 589 and Silver 12. At that point all three made higher lows and started to rally.

Friday looked like a bounce in a market that still had room to the downside, and we were seeing a normal dead cat bounce within a down trend. Monday the rallies were a little bigger however with the late charge our signals reversed to long. Looking like the metals are ready to take the next up leg.

We reversed to the long side this morning along with our algorithm although this rally looks suspect. We don’t fight the signal but from a pure technical stand the speed of to rally is too parabolic and fast. The bid and other spreads are wide indicating more of a fear trade. For now, we are long gold, silver and platinum but uncomfortably so.

The next up leg may be here, we won’t fight our signals but I pullback would be no surprise which could create a better buy level. We follow the rules of our model exactly, we are now long with a small position. To confirm that this is the next leg up, there should be a pullback and consolidation. Otherwise, this could be a monster short squeeze. Time will tell

Todd Horwitz
Chief Strategist
BubbaTrading.com

Financial Markets and Political Commentary

 

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About the author

Todd Horwitz - Author of “Average Joe Options“. Todd began his trading career in 1980 at the CBOE. He was one of the original traders in the OEX & helped start the SPX. He is a member the CME where he trades S&P futures as well as foreign currencies & is a regular contributor to CNBC, Bloomberg, BNN, Fox & many other major news networks.