Daily Market Report 10/31/12

GOLD

After being closed the past four days, Gold rallied today on a weaker U.S. Dollar and positive economic news. The U.S. Third Quarter GDP grew by 2%, higher than the forecasted 1.8%. Higher growth means more inflation which helps the price of Gold. Today’s rally was very impressive, as Gold broke out above the $1,722 per ounce short term resistance level. At 11am PDT Today, Gold is trading at $1,723.40 per ounce, up $11.90 per ounce on average volume.

Yesterday, the Bank of Japan increased its monetary stimulus by expanding its asset purchase program by 11 trillion Yen to 66 trillion Yen (US $835 Billion) and offered unlimited low interest rate loans. Increased government stimulus around the world in the long term is very inflationary and highly bullish for precious metal prices.

SILVER

Silver followed Gold’s lead today. However, the increase in the Silver price was double Gold’s price increase on a percentage basis. Silver quickly rallied above the $32 per ounce resistance level on excellent demand. At 11am PDT Today, Silver is up $0.48, trading at $32.28 per ounce on average volume.