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How to Trade Gold, Silver, and Precious Metal Miners in This Still-Dicey Market

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Precious metals may be close to a bottom, but there could be sharply lower prices still to come.

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Silver Daily Technical Chart

Silver is in the same position as gold. The question is whether this is a shakeout or breakdown.



Gold Mining Stocks Daily Monthly Chart

Gold mining stocks broke down a couple months ago and continue to sell off. If precious metals continue to move lower, then mining stocks will continue their journey down. The chart below was made in February and it has, for the most part, played out as expected. While I do not try to pick bottoms (catch falling knives), I do like to watch for them so I am prepared for a new position when the time and chart become bullish.



Conclusion

In short, precious metals continue to be in a downtrend. While they look to be trying to bottom, it is important to remember that the largest moves take place in the last 10% of a trend. So we may be close to a bottom, but there could be sharply lower prices yet.

Editor's Note: Chris Vermeulen offers more content at his sites, TheGoldAndOilGuy.com and Traders Video Playbook.
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

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