If the US Dollar is going to rise upwards next week.... traders need to be aware that if GOLD is trading below Weekly 50% level there may be downward pressure on the price of GOLD once again.
Previous Weekly report
GOLD Primary and Weekly cycles
USD dollar rose and Gold dropped, moving below the Weekly 50% level resulting in the trend moving lower and breaking a number of support levels.
There are 2 important patterns that can play out next week....
#1)Follows the Weekly range towards next week's lows, but then price remains in a tight 5-day range, whilst remaining below the breakout levels @ 1514.
#2) continues to move down towards the Support levels, as shown in the Primary chart in the 3rd Quarter.
In conclusion:- my view is that GOLD is moving down towards the 3rd Quarterly support levels, and those levels will define whether the trend will continue higher during 2011.
Quarterly support is the most robust zone for trends to begin from, and also the most logical level for the next leg of the Primary cycle, if you believe Gold will continue to rise in 2011.
However, keep in mind the failure of those support levels, but i'll come back to that at a later date.
Silver Primary and Weekly cyclesAs noted over the past number of week's, Silver is more likely to remain in a tight sideways pattern until the start of the 3rd Quarter.
As we can see, Silver may remain within the Weekly ranges over the next 5-days, until the start of July..
or price could continue down into the June lows @ 31.30
However, we can also see that the trend is likely begin the 3rd Quarter below the support level, and if that's the case, there is the possibility that Silver could drop in the 2nd half of 2011.
And if it does, then the downside target is $24.93
If it gets down that LOW, then BUY silver.
In the mean time, the trend remains sideways, and it will be interesting to see how the next 5-days plays out, and where price is in relation to the 3rd Quarterly support level.