The precious metals complex has been under pressure since the April highs for several reasons. For one, the dollar has been on the rise, and typically when the dollar is ripping higher the precious metals will take a hit to the downside. Also, treasury yields have also been ripping higher adding to the bear case for the metals. Looking at the chart on a weekly basis, there is a solid bull and bear case to consider looking at this market, and as we are nearing the end of the quarter there could be some great volatility.
Bull Case:
If you are looking to get long this market, there are a few supporting factors to consider. On the
technical side, we are testing major trendline support going back to the pandemic lows, and we have not broken this level when it has been tested and have seen significant rallies from this point. There is also good support from 883-892, and that pocket has held well when tested.
Bear Case:
As mentioned before, the dollar and treasury yields have been screaming higher, and have been
pressuring the metals lower. With yields and the dollar running up, the metals complex will struggle to find any conviction higher, so keep an eye on those markets to see if we can get a turnaround. If the market does break below this trendline support, then we could see prices sent back down to 860.5.
Check out CME Group real-time data plans available on TradingView here: www.tradingview.com/cme/
Disclaimers:
CME Real-time Market Data help identify trading set-ups and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com/cme/
*Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services.
Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.
Bull Case:
If you are looking to get long this market, there are a few supporting factors to consider. On the
technical side, we are testing major trendline support going back to the pandemic lows, and we have not broken this level when it has been tested and have seen significant rallies from this point. There is also good support from 883-892, and that pocket has held well when tested.
Bear Case:
As mentioned before, the dollar and treasury yields have been screaming higher, and have been
pressuring the metals lower. With yields and the dollar running up, the metals complex will struggle to find any conviction higher, so keep an eye on those markets to see if we can get a turnaround. If the market does break below this trendline support, then we could see prices sent back down to 860.5.
Check out CME Group real-time data plans available on TradingView here: www.tradingview.com/cme/
Disclaimers:
CME Real-time Market Data help identify trading set-ups and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com/cme/
*Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services.
Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.