The price of gold and silver have moved into a trading range. We really don’t know how much longer they will stay there. The moves being made on the geopolitical and financial system chess boards are happening in rapid succession, increasing the stress on both. One driver is the three critical elections happening over the next forty-five days. In Russia last week, the dominate party – United Russian – held a strong majority. This largely indicates the “status quo” for its domestic and geopolitical agenda.
However, the looming elections in Israel and the United States mid-terms are very different. Voting begins in Israel in late October, and with Prime Minister Netanyahu becoming increasingly unpopular, and with President Trump holding a large double-digit negative approval rating spread, both governments could see dramatic shifts in direction. This would add to what is already a very volatile and uncertain geopolitical stage. This, along with the war drums being loudly beat in Europe, we would not be shocked to see several “October surprises” in the coming weeks. Those could be both political or kinetic events meant to sway the elections in a certain direction.
Meanwhile, the emerging economic story is the price of diesel. This one fuel powers the global economy, and due to refinery shortages, the average price is now $6.50 per gallon in the United States. If that holds for another quarter (and we believe it’s likely) then increasing price inflation across the board is all but guaranteed come 2027.
None of this is bearish for precious metals. It’s now a matter of the best way to wisely accumulate. Today’s charts may help you determine which strategy is right for you. As always, we’re here to support whatever you choose to do.
The OWNx Team
Gold and Silver
What Do the Charts Say?
In our last newsletter we said that gold and silver markets were at a decision point. Gold had been following a well-defined downtrend line (blue line) and if it broke that trendline, it would likely move sideways into a trading range for several months. The good news is that it indeed broke that trendline, and it has not only found a trading range, but that range is above the $3,500-$4,500 range we considered as possible. Instead, $4,000 per ounce is now strong support, and the upper band of the trading range is around $4,800. A solid break of either line could set up a short-term rapid price increase or decline. Because the downtrend line has been decisively broken, we find it unlikely that, absent a major global market liquidation event, $4,000 should hold as we wait for conditions to send it above $4,800.
Silver too has arrested its downtrend and found what now is setting up to very strong support at $55. The upper range in it’s trading band is just above $70 per ounce. This too, is above our projected $50 to $65 trading range. A chart line to watch is the blue line. When silver breaks it to the upside, it will have room to run all the way to the $90 to $95 range with little chart resistance.
In short, it appears that the present trading range presents an opportunity to accumulate gold and silver before the next geopolitical or financial system “event” creates another run on these precious metals. As always, consult your financial advisor before investing.
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