The rates were left unchanged (so far) and we saw some strength in the precious metals and mining stocks. This does not change our outlook on the precious metals market. In fact, since rates are still where they were previously, nothing really changed. We summarized today’s first Gold & Silver Trading Alert in the following way:

Summing up, we saw some strength in the precious metals market yesterday, but it didn’t change much, if anything. The medium-term trend was and still is down. The corrective upswing was not out of the question and we continue to think that not focusing on it – but on the medium-term move is appropriate at this time. If we get a rate hike, it’s likely that metals and miners will decline substantially. If we don’t get a rate hike, it’s likely that we’ll see a small rally and some sideways movement, which is likely to be followed by a bigger decline anyway. Either way, focusing on the medium-term decline seems to be appropriate. It seems that the profits from our short position will increase significantly in the coming weeks (not necessarily days).

The above remains up-to-date. We saw a small rally (GDX moved to its 50-day moving average without breaking it, silver outperformed - which is not a bullish sign, and gold moved to $1,130 without breaking any major resistance levels) but we’re likely to see a bigger slide rather sooner than later anyway and whereas the outlook for the next several days is a bit unclear, it remains bearish for the next several weeks and months.

We’ll discuss details in tomorrow’s alert. However, if something urgent happens today (it’s unlikely, but still), we’ll send you another alert as soon as possible.

Thank you.

Sincerely,
Przemyslaw Radomski, CFA
Founder, Editor-in-chief

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