Yesterday we wrote that the rally in gold was not really convincing as it was not accompanied by significantly higher prices in silver and mining stocks. Today we see something with similar meaning - gold moved slightly ($6) lower despite the fact that USD Index moved lower as well. Silver declined today and miners didn't do much which is a bearish piece of information given that we are seeing a rally in the general stock market. 

This leaves us with the same picture that we had yesterday - the short-term situation is blurry, but the medium- and long-term ones are bullish.

Summing up, we suggest keeping long position in gold, silver and mining stocks without any increase in the size of the positions (half of the position that you would normally have when going long). Again, we believe that long-term investments in the precious metals sector should be left intact.

As always, we'll keep you updated should our views on the market change - even if it means sending another message in several minutes. We will also continue to send you Market Alerts on a daily basis (with the exception of Fridays when Premium Updates are posted) at least until the end of December.

Thank you.

Sincerely,
Przemyslaw Radomski, CFA