Gold and Silver Prices May Pull Back Before Next Buying Opportunity

Trade Nation's David Morrison believes gold and silver prices may see a pullback before investors can accumulate them at more attractive levels.

Morrison, Senior Market Analyst at Trade Nation, points out that both metals had an impressive rally in August, with gold reaching nearly $4700 from just below $4000. However, this rapid ascent has left the metals looking overbought, and Morrison expects a correction before the next buying opportunity.

The key support level for gold is around $4,350 to $4,400, which was previously a resistance zone and is now being retested as support. If this level fails to hold, gold could drop towards $4000, an event that Morrison believes would present a strong buying opportunity.

A similar setup exists in silver, with the metal pulling back after approaching its strong resistance at $70. According to Morrison, silver may test the $60 region before rebounding.