Daily Market Report 10/31/14

GOLD

This morning Gold tested its major support level of $1,170 per ounce and reached a low today of $1,161.50 per ounce. At that point demand increased, and the trading volume hit a record high, driving the price up $12 per ounce from the low. If it looks like an intra-day reversal, and it smells like a reversal, it could be the final clean out I have been looking for since August. This should cause the price of Gold to start moving higher very soon. To confirm this statement I need to see higher prices on good demand in Monday’s trading.

At 11am PDT today, Gold is trading at $1,172 per ounce, down $28 per ounce on record trading volume.

What caused the U.S. Stock Market to rally 200 points this morning? It was this morning’s Bank of Japan (BOJ) decision to accelerate its purchases of Japanese government bonds. The BOJ raised its annual pace of purchases 30 trillion Yen ($725 billion), up from 80 trillion Yen. The BOJ also said it would triple its purchases of exchange-traded funds and real-estate investment trusts (REITs). This quantitative easing or monetary stimulus is creating more paper money and ultimately inflation.

SILVER

Silver really got hammered this morning, reaching a low of $15.78 per ounce. Heavy demand appeared at that level and took the price back up above $16 per ounce on excellent trading volume. This is the opportunity I have been waiting for, and many of our clients are starting to make purchases.

At 11am PDT today, Silver is down $0.40 per ounce, trading at $16.10 per ounce on excellent trading volume.