Daily Market Report 6/20/13

GOLD

Gold slid after Federal Reserve Chairman Ben Bernanke suggested the U.S. Federal Reserve will begin scaling back its $85 billion bond-buying program later this year, saying "The committee currently anticipates that it will be appropriate to moderate the monthly pace of purchases later this year." This news, and the possibility of quantitative easing ending by next year if the U.S. economy improves, caused Gold to drop sharply. The U.S. central bank reiterated its view that interest rates shall remain low, but that was not enough for Gold traders that did not want to see quantitative easing end.

Gold fell dramatically under $1,300 per ounce on global markets which were rattled by the Fed chief’s comments, with U.S. equities falling around 1 percent and Treasuries bond yields (seen as U.S. short-term interest rates) rising sharply, and the dollar index up 1 percent. At 11am PDT Gold is trading at $1,285 per ounce, down $82 per ounce, and below the $1,300 per ounce support level.

SILVER

Silver followed Gold down, breaking below the $20 support level. Silver is down $1.88 per ounce, trading at $19.80 per ounce on heavy volume.