QE3 and support at the moving average for silver
The precious metals have continued to consolidate this week as traders trim positions ahead of Federal Chairman Ben Bernanke’s speech tomorrow. While the speech should spur some activity in the market tomorrow, overall volume on the Comex and Nymex should remain low as we head into the long holiday weekend in the US.
Yesterday, the precious metals took a hit with the release of improved US GDP figures. Gold reacted negatively as traders expectations for QE3 became dampened. The sell off today in the precious metals seems to be a result of the broader liquidation seen over a host of asset classes ranging from equities to commodities. The precious metals are clearly not the only asset succumbing to apprehension of further news regarding QE3 tomorrow. This temporary downturn should provide some decent opportunities to get long the market. Today silver has already held perfectly at the 200 day moving average of $30.30. Participants should keep an eye on the 200 day moving average of gold $1,641.50 as an entry point as well.
