When gold could only rally $9 on the back of terrible GDP numbers, then I knew that we were in for another rough day. The $US is again relentless as it has moved up from 74.17 to 78.41 in about 3 weeks, while gold has fallen from $US spot 1225 to the $1073 area today, some $150. Silver has fallen fron $19.14 to the $16.75 area today, some $2.40. Both have become very oversold, but as we saw on the way up, they can stay that way for weeks. A bounce from today's lows are also very possible.
It is the EURO weakness that is primarily forcing the $US up...which puts pressure on gold with a LOT of help from the "boyz". The DOW and S&P keep going up on funny money...this is all nothing like Oct/Nov of 2008.
And the JPMs are simply not being sold off like before...in fact there is some green today even with another down leg in HUI, XAU, GLD, SLV, gold, and silver. THIS IS NOT THE USUAL SEASONAL BULLISH 3RD WEEK IN DECEMBER WITH METALS!
Interset rates will be forced up next year and stocks and metals will be beneficifiaries as money flees bonds. This dead cat bounce in the $US is a medium term one and it appears that 80.00 will be next resistance zone if this week closes above 78.00.
Can gold and silver stay puny all the way into early January?....sure, as there are only about 5 total tradings days remaining, but gold and silver are overdue for at least a good bounce just as soon a margin call crap depletes. And margin requirements have been recently raised in concert with this all out cartel effort to cool gold and silver.
So, the main cross currents for me are [1] continued pressure on interest rates which will move money out of bonds next year, [2] blatent gold and silver "management" in the face of a supporting dollar due to EURO weakness, and the encouraging support being maintained by canadian junior PM stocks [JPMs].
How ironic that the currency markets rule even as they all are in collapse mode....go figure!....pic
