Just a quick update as things are moving quite fast in the PMs.

In short, it’s very likely that today’s upswing is based on uncertainty related to the U.S. midterm elections.

And as the uncertainty fades away as soon as the outcome is known, the trends are likely to be back to normal.

The USD Index moved to its recent lows today – it didn’t break below them. The flag (consolidation!) pattern remains intact and it suggests that the next big move will be to the upside. This is bearish for gold.

While gold futures remain below their Oct. high, silver futures soared above their respective Oct. highs. This is yet another indication of silver’s outperformance, which is known to be a sell signal.

Yes, I realize that it would be much more pleasant to see the market move the other way around, but sometimes the market is simply like this – it tests one’s patience and their ability to stick to the main trend, and to what is likely to happen, despite the short-term emotional turmoil.

The bearish outlook for the precious metals sector for the medium term remains intact, and – in my opinion – the junior mining stocks are going to move MUCH lower in the following weeks and months.

As always, we’ll keep you - our subscribers - informed.

Thank you.

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