Metals Momentum
Today was a pivitol day, as the Federal Reserve pushed their outlook to late 2014 before an increase in FOMC interest rates...CHEAP MONEY!!! The basic idea goes: lower rates = lower US dollar. Lower US Dollar = higher precious metals. You can guess on the following intraday charts when the announcement was made.
Intraday charts provided by http://www.kitco.com/
This week, silver moved back into it's previous trading range of $30 - $35/oz. Today's gold settlement over $1700 is key, not just from the price resistance that has developed there over the past 4 months but also from the psychological resistance that whole numbers have on prices. Remember, there were many weeks of consolidation at these levels very recently. From a technical analysis view, nothing has changed for silver, although the recent downtrend on gold's daily chart was broken on high volume with today's knee-jerk reaction. Fundamentally, the environment of long term inflation has been magnified by the US Dollar due to the Fed's new policy of excess transparency. My bias for the metals long-term continues to remain bullish. However, until this period of consolidation ends, I recommend waiting until confirmed breakout over $35 to enter new longs. Best of Luck! -AJL
Adam Laigo
Semper Pacific Wealth Strategies
metalsmomentum@gmail.com
Twitter: @PrcsMtlsGuy
