Buying opportunity at this long-term support level

Without any unexpected events, this week would seem to fit in line with the low relative volatility we have seen in Precious Metals and Equity Markets the past few months. There are a few announcements regarding unemployment towards the end of the week, but we don’t expect anything too far out of line of expectations. All anyone has to do is turn on the TV or open up the newspaper and they can see that equity markets, in particular American equity markets are at or near all-time highs. In that same time gold and silver have declined approximately 20% off their highs and have found support near the $1550 level for gold and the $28.50 level for silver. The $1550 level provided major long term support. Support is formed naturally by market participants as buyers and sellers interact. Last summer gold could not break below $1550 as every time it approached that level it was deemed at a discount by enough participants to drive the price back up. For those with patience through the summer they saw the price of their gold go from $1550/oz. to $1800 in a matter of 2 months. Going back even further, this theory is further supported. Notice the extreme support level at $1550 and how it holds every time it has tested this level since February 2011 and then subsequently rebounded making those who got in at this long term identifiable support level a quick and tidy profit. The ability to both recognize and take action on long term trends is essential to making money in any market and we think we are on to one… Happy investing!