Gold and silver both continued to move higher today, however just like two days ago, gold miners took it on the chin with another triple digit losing day for the DOW. The DOW lost 334 points marking its worst day of the year. The question one might answer, at least for today, was physical gold a safe haven today? I’d say it was.
I am technically bullish on stocks though after this carnage subsides. We are still in a bull market for stocks. Think a nice bounce might be coming but tomorrow morning there still may be some selling.. This could push the mining stocks higher as long as gold stays above $1,200. The mining stocks did close with an uptick.
From the Trading Desk
Gold was trading lethargically yesterday until the US Federal Reserve policy meeting prompted investors to push back their expectations for the timing of a Fed interest rate rise. The Fed specifically mentioned the strength of the USD in its September meeting minutes and equities and gold both shot up. Today, stocks have given up all of yesterday’s gains and the Dow is once again approaching its 200 day moving average at 16,590. The sell off today is in part due to European Central Bank Mario Draghi stating that Europe’s problems are structural, not cyclical, and that without reforms there can be no recovery. The inverse correlation between equities and gold has meant that gold has continued its run higher today. Gold ETF holdings have bled once again though and are at their lowest level since December 2008 at 24.5 million ounces in the SPDR Gold Trust. Gold remains range bound with huge support at $1,180 and resistance overhanging at $1,240.
10-09-14 GLD Chart
10-09-14 SLV Chart
10-09-14 GDX Chart
Disclosure:
Commodity Futures Trading Commission Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don’t trade with capital you can’t afford to lose. This is neither a solicitation nor an offer to Purchase/Sell futures or options. No representation is being made that any account will or is likely to achieve gains or losses similar to those discussed in this outlook. The past track record of any trading system or methodology is not necessarily indicative of future results.
All trades, patterns, charts, systems, etc. discussed in this outlook and the product materials are for illustrative purposes only and not to be construed as specific advisory recommendations. All ideas and material presented are entirely those of the author.
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About Doug EberhardtDoug 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
Disclosure:
Commodity Futures Trading Commission Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don’t trade with capital you can’t afford to lose. This is neither a solicitation nor an offer to Purchase/Sell futures or options. No representation is being made that any account will or is likely to achieve gains or losses similar to those discussed in this outlook. The past track record of any trading system or methodology is not necessarily indicative of future results.
All trades, patterns, charts, systems, etc. discussed in this outlook and the product materials are for illustrative purposes only and not to be construed as specific advisory recommendations. All ideas and material presented are entirely those of the author.