Gold and silver are both very close to the target levels that we featured in today's Premium Update (and that we've been describing for a few weeks now).

We believe it is a good idea to close the speculative short positions in gold and silver now (we will close our positions after this message is sent). At the moment of writing this alert, gold is trading at $1,684 and silver is at $31.28. 

Yes, gold and silver didn't reach our target levels for the decline ($1,673 and $30-$31 respectively), but both metals are so close to these levels that we think that it's not worth to wait for the final bottom because the possibility that metals will bounce and then fail to decline more is relatively significant. 

At the same time we suggest placing long order for gold and long order for silver at $1,680 and $31.10, respectively. Gold may move temporarily below the 300-day moving average, but it is very likely (75%) in our view that such a move would be only temporary (not more than a week below that level). The following rally might be quite sharp, so we don't want to risk missing it. 

We suggest putting stop-losses for these long orders at $1,660 and $29.90, respectively. We don't suggest any stop-loss order for the current long position in mining stocks.

We suggest holding the speculative long positions in the mining stocks and also holding your long-term precious metals investments 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.

Thank you.

Sincerely,
Przemyslaw Radomski, CFA