Gold Rallies Due to Bank Collapse

GOLD

The financial markets and Federal Reserve continue to react to the collapse of Silicon Valley Bank. While on Sunday, New York state regulators shut down Signature Bank; a big lender in the crypto industry. The financial markets believe it is likely that we have seen the end of higher interest rates, and the Fed will stop draining liquidity from the financial markets. It is more likely that the Federal Reserve will be adding liquidity to the markets to shore up confidence for regional and local banks. Based on the above concerns Gold opened higher this morning and kept on moving up, reaching a high of $1,914 per ounce before seeing some light selling. A lower U.S. Dollar Index also contributed to Gold’s rally. At 11am PT Today, Gold is trading at $1,911 per ounce, up $43.30 (2.3%) on excellent volume.

SILVER

Silver suffered a large decline in price due to concerns about higher interest rates, now we are seeing the opposite. The Silver’s price reaction to today’s Fed reversal in policy was highly explosive. This morning Silver opened higher and move up quickly, reaching $22.05 before seeing light selling. At 11am PT today, Silver is up $1.27 per ounce (6.18%), at $21.80 per ounce on strong volume.