Precious metals didn’t follow the script overnight; bonds enjoyed a safety bid, but gold and silver were sold off as the “weak longs” grabbed profits following the stellar advances over the last 18 months. At one stage, gold fell over $US120 below its intraday high, while silver closed down by more than 6%. We are never keen on markets that don’t rally when they, in theory, should, and in this case, it dovetails with our view that the advance by precious metals has, in all likelihood, found a short term top.
- We can see the sliver testing support below #US30/0z, around 10% lower.
MM is neutral/bearish towards silver
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