Daily Market Report 9/26/14

GOLD

Gold tried to breakout this morning, reaching a high of $1,230 per ounce, before the sellers came in to drive the price below $1,220. Professional commodity traders point to the extraordinarily strong U.S. Dollar (which reached a four year high today) as the main cause.

This week the bears have made two attempts to take the price below $1,200. On Monday, the bears were able to drive the price down to $1,208, and on Thursday heavy sellers drove the price down to $1,206 per ounce. I believe we will see the third attempt to break below $1,200 per ounce by this coming Tuesday, Sept 30th. If the bears are successful, Gold will be in a short term bear market. However, on that day, if the Gold price makes a new low then closes at or near the day’s high with heavy volume (referred to as an inter-day reversal) then I think Gold and Silver will be a buy, and traders will become bullish.

At 11am PDT today, Gold is trading at $1,215 per ounce, down $8 on normal volume.

SILVER

Silver traded today between $17.45 and $17.76 per ounce on normal Friday type low trading volume. Silver continues to look to Gold for price direction, and if I am correct about next week, Silver should selloff sharply by Tuesday, possibly breaking below $17 per ounce. Like Gold, I believe Silver is getting very close to turning higher.

At 11am PDT today, Silver is down $0.03 per ounce, trading at $17.52 per ounce on normal volume.