Daily Market Report 9/02/14

GOLD

This morning, the Dollar hit a one-year high against the Euro, based on an improvement in the U.S. Economy and actions by the ECB to weaken the Euro. This caused Gold to break down below $1,280 per ounce on heavy volume (over 100,000 December hundred ounce contracts) and quickly drop to the $1,260 area. It appears that Gold could hit its major support at $1,250 before starting the next rally higher. This is called by traders “Cleaning out the Weak Hands”. If Gold reaches the $1,250 per ounce level and quickly turns higher on heavy volume, this would be a major buy signal.

At 11am PDT today, Gold is down $20 per ounce, trading at $1,265 per ounce on heavy volume.

SILVER

Silver dropped with Gold, reaching a low of $19.10 per ounce. $19 is a major long term support level, which Silver is sure to test. Holding $19 is key to the short term direction of Silver.

At 11am PDT today, Silver is trading at $19.17 per ounce, down $0.29 per ounce on excellent volume.