By Chris Vermeulen
Precious metals like gold and silver appear to be forming a bullish pennant formation, which generally leads to higher prices. Currently the US dollar is hovering around a support level, which is the 76- 79 range. Only time will tell if the US$ breaks down sending gold to new highs in the coming months.

You can clearly see the pennant formation with gold nearing is apex. Soon enough spot gold prices are going to Blast off or Drop off.

Spot silver price is forming a similar price pattern. Because spot silver is much more volatile the pennant is a little taller. Again we wait for a low risk setup.

Precious metals are slowly working their way to the apex of their large multi month pennant formation. In the coming weeks or months I expect to see prices spike much higher with everyone dumping their money into the safe haven GOLD & SILVER.

When spot silver and gold prices start to break down from these multi month pennants we investors will start withdrawing our funds from precious metals at a very fast rate sending prices down.

As always, I keep focused using my low risk-trading model, which helps to alleviate the emotional part of trading during a time like this. Knowing that my down side risk is generally under 3%, this allows me to stay calm and focused.

When a trade goes against me, it is not damaging to my account and I review what I have done to be sure I followed my trading system as planned. Losing trades happens all the time in trading, as it’s just part of the game. Knowing this, accepting it and keeping losses minimal is what separates profitable traders from the not so profitable traders.

Courtesy: www.GoldAndOilGuy.com

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