Technical Scoop: Rounding Top, Rising Oil, Bottoming Gold

Excerpt from this week's: Technical Scoop: Rounding Top, Rising Oil, Bottoming Gold
Gold and Silver

Source: www.stockcharts.com

Whither gold? The indestructible metal, a centuries-old safe haven. It has taken a hit. At the recent low gold had fallen 27%, officially a bear market. Silver had fallen 50%, while the TSX Gold Index (TGD) was down only 30%, a surprise, really. Normally the TGD would be down at least 70% as it was in previous collapses in 2008 and 2020. View that as a win. That this correction was overdue given the sharp rise during 2025 and early 2026 should not have been a surprise. That it has gone deeper and lasted longer than many expected is probably a bit of a surprise.

That’s the bad news. The good news is that despite the sharp drop, gold, silver, and the gold stocks remain in bull markets. We’ve seen this picture before, particularly during the 2008–2011 bull market where a few sharp corrections (20%+) were not unusual. We’ll base this one off the monthly lows during a year as a signal that the bull is officially over. A drop under $4,000 would be a bearish signal. But the real drop doesn’t come until under $2,600. We don’t see that in the forecast. As a result, we are gathering support for gold around $4,200, and silver $63. The TGD has key support in the 770 area while the HUI’s support lies at 665. All these points are where we saw recent lows. From our perspective, we’d prefer to see these levels hold.

We did see something positive with this week’s action. When oil prices leaped once again and the stock market fell, with bond yields and the US$ Index ticking higher, gold, silver and the gold stocks were up, rather than following stocks down as they did before. A divergence? Gold gained a meagre 0.2%, but that was after falling earlier, silver was up 2.8%, the Gold Bugs Index (HUI) gained 7.1%, and the TGD was up 8.2% on the week. A positive development. The US$ Index was up 0.6% this past week, while the euro fell 0.4%.

Not as lucky was platinum, which fell 3.4%, and palladium, down 2.1%. Copper rose 3.4%. Gold and gold stock indices (HUI, TGD) are up marginally on the year while silver, platinum, palladium, and copper are all down on the year as of Friday, March 27. It was the first weekly gain for gold since the war began. Gold would respond well to stagflation where the economy is slowing and turning into a recession even as inflation rises. Against that backdrop, the Fed is reluctant to raise interest rates. However, can the Fed lower rates? Or as we say, they are caught between a rock and hard place, with a president pushing for lower interest rates.

One week does not mean the sell-off is over. We need to see gold take out $5,000 and silver over $90 to suggest and confirm that a low is in. We’d like to see the TGD regain above 1,000. We note that the juniors saw some bids this past week as well. With the Middle East in chaos and the war potentially expanding, gold retains its safe-haven status. It’s indestructible and has no liability, unlike everything else.

Source: www.stockcharts.com

Source: www.stockcharts.com

Read the FULL report here: Technical Scoop: Rounding Top, Rising Oil, Bottoming Gold
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David Chapman is not a registered advisory service and is not an exempt market dealer (EMD) nor a licensed financial advisor. He does not and cannot give individualised market advice. David Chapman has worked in the financial industry for over 40 years including large financial corporations, banks, and investment dealers. The information in this newsletter is intended only for informational and educational purposes. It should not be construed as an offer, a solicitation of an offer or sale of any security. Every effort is made to provide accurate and complete information. However, we cannot guarantee that there will be no errors. We make no claims, promises or guarantees about the accuracy, completeness, or adequacy of the contents of this commentary and expressly disclaim liability for errors and omissions in the contents of this commentary. David Chapman will always use his best efforts to ensure the accuracy and timeliness of all information. The reader assumes all risk when trading in securities and David Chapman advises consulting a licensed professional financial advisor or portfolio manager such as Enriched Investing Incorporated before proceeding with any trade or idea presented in this newsletter. David Chapman may own shares in companies mentioned in this newsletter. Before making an investment, prospective investors should review each security’s offering documents which summarize the objectives, fees, expenses and associated risks. Although Artificial Intelligence (AI) may be deployed from time to time, AI output is monitored and adjusted, if necessary, for accuracy. David Chapman shares his ideas and opinions for informational and educational purposes only and expects the reader to perform due diligence before considering a position in any security. That includes consulting with your own licensed professional financial advisor such as Enriched Investing Incorporated. Performance is not guaranteed, values change frequently, and past performance may not be repeated.