Daily Market Report 8/19/14

GOLD

Gold dropped a bit more again today as the market is currently waiting on a few key indicators to determine its direction. Housing starts in the U.S. reached the highest level in eight months, adding to evidence the U.S. economy is gaining traction. All eyes are on Jackson Hole this week as investors anticipate what Fed Chair Janet Yellen and ECB President Mario Draghi have to say on their respective monetary policies. If the U.S. economy continues to gain traction, as indicated by housing starts reaching their highest level in eight months, Gold could test the $1,288 support level; if geopolitical tensions in the Ukraine or Iraq escalate, Gold could quickly rise to $1,320 or above.

At 11am PST, Gold is trading at $1,296.70, down $2.86 on above average volume.

SILVER

Silver followed Gold’s lead today and hit around the $19.40 level before seeing some good support. All things being equal, Silver, even with the recent drop, has been trading in a pretty narrow range of about $0.25 over the last few days. I would expect to see it test the $20 level if Gold takes a run after the Jackson Hole meeting, but the volume of trading happening today is lighter than normal.

At 11am PST, Silver is trading at $19.49, down $0.10 on below average volume.