GOLD TRADE ALERT (3:30 pm EDT)
The Bank of Japan surprised everyone today by leaving its monetary policy steady (most analysts had been expecting an aggressive loosening of policy) and this caused the U.S. dollar to take a plunge. Note that the U.S. Dollar Index is now near critical support around 93. If this drop is just a temporary knee-jerk reaction to the BOJ's announcement today, it may bounce from here, but if the dollar starts breaking below 93 it could be in big trouble.
The dollar's plunge triggered a surge in gold and silver prices. The stop loss in our gold short position has been triggered so we are covering (getting out) of that trade today with a small loss. It is still possible for gold to turn down now, but the possibility of gold breaking to the upside (especially if the dollar breaks down) is now much higher so it is probably best to be out for now. Covering all short positions in gold today and still out of silver.
I will comment a little more on the precious metals later this evening.
The Bank of Japan surprised everyone today by leaving its monetary policy steady (most analysts had been expecting an aggressive loosening of policy) and this caused the U.S. dollar to take a plunge. Note that the U.S. Dollar Index is now near critical support around 93. If this drop is just a temporary knee-jerk reaction to the BOJ's announcement today, it may bounce from here, but if the dollar starts breaking below 93 it could be in big trouble.
The dollar's plunge triggered a surge in gold and silver prices. The stop loss in our gold short position has been triggered so we are covering (getting out) of that trade today with a small loss. It is still possible for gold to turn down now, but the possibility of gold breaking to the upside (especially if the dollar breaks down) is now much higher so it is probably best to be out for now. Covering all short positions in gold today and still out of silver.
I will comment a little more on the precious metals later this evening.
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