Gold and Silver Outlook 11-18-14

Gold managed to move higher again today surpassing the $1,200 resistance level but closing below at $1,197.10. Silver eked out a small gain. But it was the miners again that took the day. The miners took out yesterday’s highs, lingered then kept going higher. GDX was up 4.69%, NUGT 14.62%, JNUG up 20.04% and JDST took it on the chin and was down 21.14%.

Is anyone complaining about those returns or the returns the last few days? I expect the weekly’s to turn green soon hopefully providing a good swing trade but we have the results of the last Fed meeting coming out Wednesday that can put a damper on things. I expect some volatility now with the $1,200 mark for gold being resistance. Any move above that I would attempt a long in miners or keep your longs with stops placed as it moves higher. Personally I like going home flat the miners each day because you never know when you wake up what might happen overseas. Just look at the snapshot of JDST this morning below.

This was the snapshot of JDST pre-market when I woke up this morning at 3:56am PST. It was already down 15.71%.

 

From the Trading Desk

After a mostly stagnant week of trading, gold and silver finished last Friday by making fresh weekly highs and breaking through previous resistance levels.  Gold decisively closed above $1,180 on Friday and despite an uneventful trading day yesterday, it has caught bids yet again today after forming a base in this higher range.  Stops in silver were triggered at $16 on Friday and it quickly shot up to an intraday high of $16.40.  There is now a double bottom at $16 from yesterday and today which is buoying the market.  The near term objective to the upside is the 50 day moving average at $17.15.

USD weakness, largely due to German economic sentiment beating expectations, has given gold extra legs today.  The SPDR gold ETF saw the first inflow of ounces being added since November 3^rd.  Overall holdings in the world’s largest gold backed ETF now stand at 723 tons (23,244,450 ounces).  Chinese physical demand is also staying marginally elevated and is trading at a $2-3 premium over London spot gold.  In India, the central bank (Reserve Bank of India) is in talks with the government to increase curbs on gold imports.  Developments on this should be watched closely and an announcement could be made as early as this week.  Imports of gold into India in October jumped fourfold from a year earlier to $4.2 billion, raising concern about India’s balance of payments.

Today’s article has been released on the main blog page. If you signed up to receive our Newsletter, you will automatically receive it in your email box. With the news today of a better than expected PPI report and the financial media claiming the Fed will raise interest rates, I wanted to address what the Fed still should be concerned about; deflation.

The article is titled; Is Deflation Still a Threat to Gold?

Enjoy the run up in gold. While it lasts!

Other ETFs I Watch

USO continued its downward move closing at $28.20 and is still in watch mode.

UGAZ took a breather today but 50% or more of America that is getting snowed on is feeling the need to turn on the gas. Thursday’s report might be a good risk versus reward to go long with stops. Closing price now is $15.66 but the high of the day was $16.58.

TZA still on the watch list.