MY PRECIOUSSS...

Seems there are many who are bullish on Gold and Silver, and a few who are bearish on it.  Let us take a look at a more logical and simpler way of looking at it.

We will use our Weekly chart as our main trend, and use our Daily chart as our trade momentum. For those trying to understand this theory please visit my past "POST". 

We can see that our weekly trend is up therefore we should only trade the trend.  The reason is any counter trend move like corrections will not have enough move in price.  It is better to have both indicators going in the same direction.

If you are looking to trade on the long side it is better for your daily to either turn down and start at its oversold position (Bottom) or to enter a small position here in case that it keeps its overbought sentiments.  We also have to watch to make sure that the Weekly does not turn back down "if" the Daily stoch. starts to move down.  Remember that they both affect each other and Daily acts like engine on a train where it goes so does the Weekly. 

NOTE: This is KEY on trading the STOCH.  Notice that in any trends when it hits the overbought oversold condition.  You are more likely to see a quick turn around if its counter trending and stays overbought /oversold when its with the trend. Take a look at the Aug to Oct 2012 UP TREND.  Notice the oversold condition that lasted almost a month and a half.  Do not think just because its overbought or oversold that it will turn the other way.  Just like in November or 2012 when the Weekly trend was down we saw a daily peak at overbought that was quite short.  A good reversal indictor also can be seen when price and stochastics diverge.