The precious metals sector declined today and it was probably a late reaction to the USD Index's strength. What's next? Gold moved to the support line based on the Dec. 2013 and Jun. 2014 lows, so we could see a short-term bounce here. This could be the corrective upswing that we mentioned in today's first alert. As a reminder, we expect a small move higher in PMs and miners to take place along with a corrective move lower in the USD Index (that would simply verify this week's breakout). If the precious metals sector is to move temporarily higher, then we can expect silver to outperform. It's been holding up relatively well today.

Consequently, aggressive traders might want to use a very small portion of the trading capital to bet on higher silver prices in the next several days. That's definitely not a trade that we can suggest to most traders, but something that day traders might want to consider.

Thank you.

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

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