(H/T Gold Silver Worlds)
Today was an exceptional day in the precious metals. COMEX Gold soared with 3.05% on the day on heavy volume. Although that is certainly good news for gold bulls, the most exceptional characteristic was the huge jump from its intraday lows. The yellow metal touched $1,140 after a big decline which started in overnight trading (Asian opening) before making a big reversal, straight up to $1,220 in a matter of hours. That is a 5.9% intraday swing. It goes without saying that the price action is very encouraging.
The first chart is an hourly chart (courtesy of Finviz). Both the huge price reverals and big volume stand out.
Silver made an even more extreme move, although with a similar chart pattern. The grey metal literally sold off and spiked for some minutes below $14.50, after which a huge reversal took place to $16,80. COMEX Silver closed the trading session at $16,46 with a gain of 5.81%, but the intraday swing was almost 18%. Zerohedge notes that “this is the biggest positive swing since our data began. All the previous major swings have been downshifts, most recently in September 2011 (-22% and -18% over 2 days).”
The daily price chart shows some extremely interesting characteristics (courtesy of StockCharts.com). First, gold tested the August declining trendline for a third time today and closed right at that trendline. Second, the lows of the day came in at a higher low compared to the multi-year low which was set at the 10th of November. Third, the technical indicators are looking really fine: the RSI is on the move higher (with higher highs and higher lows since early November) with a reading above 50 and the MACD line is on its way to zero. Fourth, the gold price has closed above the 20 day and 50 day moving averages.
Although not very clear on the chart, try to spot the huge volume of today. It is by far the biggest volume since the March highs.