Gold continued its way down again today but it did at least bounce from the lows. I have to lean for the short term that we continue this bounce higher but I think it will be short lived and the next stop the break of $1,100. Silver will fall faster than gold after this short term correction. If the dollar stays below 96 though, use that as your key to ride gold and silver higher. It’s at 96.27 now.
With the return of the stock market bull after the good Consumer Confidence news out, the DOW managed to move up over 200 points following Asian and Europe’s lead higher. Interest rates moved up a bit on the risk off trade as month end positioning for mutual funds had most buying as they prepare for the 4th quarter. Where do you think the market will be by the end of the 4th quarter? I lean bullish stocks and down with the metals in one more push higher. But we need China to cooperate and no October surprises for the markets. I may lean this way, but for right now even though all my indexes are still pointing lower.
Part of the reason I lean this way is perception tells me that things are still ok in the economy with mainstream consumers. CNBC still calling for rate hikes along with many Fed board members. After a dismal 3rd quarter it would not surprise me that market makers give investors a nice Thanksgiving and Christmas holiday as that has been the trend the last 3 years or so.
Fed chairman Janet Yellen spoke today but skipped out on monetary policy remarks. I guess the old adage, “no news is good news” comes into play here. That or she didn’t want to get stressed out again as she did in her last speech.
This dip in precious metals isn’t causing the phone to ring much as buyers are confused all the way around. The stock market yoyo is a difficult one to play but keep an eye on volatility for direction. If we get some more good news on the employment front then it could be what triggers the market and dollar higher and gold/silver lower.
Doug Eberhardt is a 28 year financial services veteran and precious metals broker selling gold and silver at 1% over wholesale cost. Doug has written a book to help investors understand how gold and silver fit into a diversified portfolio, how to buy gold and silver, and what metals to buy. The book; “Buy Gold and Silver Safely” is available by clicking here Contact phone number for Buy Gold and Silver Safely is 888-604-6534
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