by Gerardo Del Real
Last week, I outlined why I felt caution was necessary in the gold and junior space. The failure of gold to rally, despite a weaker dollar, was a clear sign that there was a consolidation in the cards.
After failing to breakout early in the week — despite the U.S. dollar index falling to an eight-month low — gold has consolidated to the ~$1,230 level. There is heavy resistance at the $1,260 level and a weekly bottom at the $1,220 level.
I continue to believe the price trends will lower over the coming months. Gold couldn’t surge higher with a weaker dollar, but a stronger dollar later in the week did contribute to the pullback.
Silver on the other hand had a great week, hitting a 5.5-month high of $16.26 on Wednesday and a new high of $16.34 on Friday.