This breakdown by silver clearly does not auger well for gold.
Silver never did confirm gold's breakout to new highs, which has always been grounds for some caution. It has followed the path predicted in the last update to the letter, as can be seen on the older 6-month chart included beneath the current chart below, but has run into trouble this month at resistance at the underside of its earlier broadening channel. On Friday it broke down sharply from its steeper uptrend in force from early February in response to renewed dollar strength, a development, which is viewed as decidedly bearish and constitutes a SELL SIGNAL—which would only be negated by a break above the trendline that capped the advance, which is now at about $17.70. This breakdown by silver clearly does not auger well for gold.
The latest COT chart for silver shows that the Commercials have been ramping up their short positions in recent weeks, which is viewed as another warning that we are probably witnessing a reversal to the downside now.