Gold – Silver Correction - Break out from a Descending Triangle

Gold has been consolidating in a descending triangle this week after it found resistance at about 1322. Note the bullish bias in the 1H chart.

1. Price was bullish at the end of last week, so the prevailing trend in the 1H chart is bullish before it consolidated this week.
2. Price is for the most part trying to stay above the 200-, 100-, and 50-hour simple moving averages, which would reflect a bullish market.
3. Price broke above the descending triangle resistance today.

However, you can see that as we get into the 8/15 Asian session, price is falling below back into the 100-, and 50-hour SMA area. Gold has retreated back into the previous triangle. It is also breaking below a 2-day rising trendline seen in the 1H chart.

Gold (XAU/USD) 1H Chart

Silver (XAG/USD)

Silver has entered a period of consolidation as well. It has been mostly sideways with the 19.73 area as support, and 20.17 area as resistance. There is a divergence between gold and silver. You can see that gold is consolidating after a bullish swing because the moving averages were upward sloping in the 1H chart. The moving averages in silver’s 1h charts, are downsloping.
For silver, a break above 20.00 will be needed to put away some bearish bias in the short-term, and a break above 2.20 would put in a price bottom for a bullish outlook.

Silver (XAG/USD) 1H Chart