Current Thoughts for 5/10/2016

From the Trading Desk

US nonfarm payrolls disappointed on Friday of last week, adding just 160,000 jobs in the month of April.  This was the worst figure since October of last year and well below the consensus estimate of 200,000.  Despite the economic release, the USD shrugged off the news and the USD index is now up for the sixth day in a row.  USD strength weighed on gold over the weekend and Asia entered the market as a seller on Sunday evening.  Gold had its biggest single down day yesterday in nearly two months and closed near the lows of the day.  The overall sentiment has now turned short term bearish after failing multiple times at $1,300.  Major support is coming in at the 50 day moving average of $1,248.50 while rallies will likely be sold into.  Silver failed at $18 and has sold off steadily over the past week.  Just as it did on the run up, it will look to consolidate around $17 again in the near term.

I want to make note that during the early morning run up in the dollar, gold and silver followed suit south but the dollar reversed mid-stream and we saw gold and silver reverse course higher. They are still in sync as opposites and my thoughts from Sunday are still in play. I will adjust from a micro level that if the dollar falls below 94 again gold and silver should take off higher.  Over 94.32 or 94.35 and gold should have some trouble ahead.


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About Doug Eberhardt

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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