A Doji Candlestick Can be Identified in Three of The Four Precious Metals

March 5, 2019 - 5:59pm

 by Gary Wagner

Apart from palladium, all the other precious metals are trading fractionally to modestly higher on the day. Fractional gains can be seen in gold pricing today and as of 4:45 PM Eastern standard time gold futures are currently up $.90 and fixed at $1288.40.

Platinum is also exhibiting fractional gains currently trading up by one dollar and fixed at $839.90 per ounce. Silver which is been under strong selling pressure recently has modest gains of .33% (+.050) and is currently fixed at $15.155.

Palladium is the only precious metal complex which is trading lower on the day. Palladium futures are currently down $12.60 (-0.85%) and fixed at $1472.50.

For the most part it seems as though the metals which have been battered so hard recently are attempting to find some sort of bottom in support at current pricing.

However, the real caveat in today’s trading range is that even with three of the four precious metals scoring small gains, all three metals have made lower lows, and lower highs than the previous day. This would suggest that that the Bears are losing momentum.

One indication that we could be witnessing a bottom, whether it is short-term, or a key reversal is the identification of a single candlestick called a “doji”. This candle type can be identified in the daily candlestick chart of gold, silver and platinum today.

The doji candlestick can be identified by its open and closing price being identical or a few ticks apart. As a standalone candle it can be neutral in status indicating a time of consolidation. It can also indicate a potential pivot point or key reversal as it becomes an key candlestick found within a larger multi-day pattern such as a “three river morning star”.

          

According to Investopedia a, “Doji tends to look like a cross or plus sign and have small or nonexistent bodies. From an auction theory perspective, doji represent indecision on the side of both buyers and sellers. Everyone is equally matched, so the price goes nowhere; buyers and sellers are in a standoff. Some analysts interpret this as a sign of reversal. However, it may also be a time when buyers or sellers are gaining momentum for a continuation trend. Doji are commonly seen in periods of consolidation and can help analysts identify potential price breakouts.”

The fact that all three precious metals exhibiting fractional gains today have done so with the same characteristics, a lower low, and a lower high than the previous day, as well as open and closing prices almost equal, could in fact be indicating that the selling pressure in gold, silver and platinum have run its course.

Wishing you as always, good trading,

Gary S. Wagner - Executive Producer

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