They say a picture is worth a thousand words and in this case it rings true. Gold is solidly in a bull market and while volatile, you can take a look at the platinum chart below, and while it ranged within a $300 range or so while trading above $1,000, it looked volatile and there were times when it seemed it was heading down. Well, it sure didn’t head down but nearly doubled in a matter of months. Expect this from gold in the future…just be patient.

$850 has held very well and, as far as I can see, will never be seen again although a test of it would be nothing but healthy. Both downtrends from the peak have been broken solidly.

All moving averages are heading steadily higher and are far from any bearish sign such as a bearish crossover. The 50-day MA is passing $850 making that level all but history. This is one healthy market on a longer-term weekly chart.

RSI remains above 50 signifying a strong bull market. MACD is making a bullish crossover from a nice level. Slow STO is crossing 80 and is signalling an up-trending gold market:

Silver is taking off and breaking above resistance just below $19 as indicated on the six-month chart in the newsletter. A solid uptrend is holding nicely and $16.50 is very strong support and has held on the many recent tests.

The 50-day MA is soon to cross the support region at $16.50 making it less likely to ever be seen again. MACD is making a bullish crossover from its long downtrend. MACD does not make many crossovers in silver and when it does it usually signifies a strong up move or a correction, followed by consolidation so look for the up move to take its turn here and now. Slow STO turned up right at the bottom and has been an excellent timing signal on this chart recently. Last time slow STO began an uptrend from recent levels the price of silver ran up nearly $10:

Platinum remains within its bullish triangle formation and should continue to tighten its trading range until the triangle is broken to the upside by early fall at the latest. Strong support lies way down just below $1,400 and will likely not be tested ever or for many years. Fundamentally, platinum is very strongly supported at these levels at least until the Eskom power situation much talked about here is resolved. But it still comes down to supply and demand and while other metals are being experimented with in the catalytic converter arena none have yet proven as effective on gasoline engines which are by far the most widely used worldwide and will remains so for many years to come.

The moving averages are still pointing north and solidly so. They have a long way to catch up after the explosion in price but are steadily making progress. RSI remains bullish above 50. MACD is heading lower and as with silver is just signalling a consolidation move, which happens to be with a very bullish formation, the triangle. Slow STO is undecided but slightly bearish and not really giving us much to work with, but with all the other indicators, price and moving averages performing as they are, things are positive:

Palladium is making higher highs and higher lows as it consolidates and postures to break through the downtrend at $450. This pattern will resolve itself one way or another within the next two weeks tops and will give us a better indication of the future.

The three moving averages are heading up and the 50-day MA is not lagging far behind the price and should be supportive. RSI is bullish remaining above 50. MACD is slightly bearish but that just signals consolidation during bull markets. Slow STO is bullish but flattening out as the price runs into the downtrend line.

It was a very constructive week for the precious metals and, by the looks of things, we have more positive things to look forward to in the near future.

You can follow my technical analysis and the complete precious metals industry breakdown at my website: http://www.preciousmetalstockreview.com/.

Best regards,

Warren Bevan
July 15, 2008

Charting New Highs for Precious Metals was originally featured in the Penny Sleuth.