PM Daily Market Commentary - 9/25/2013

By davefairtex on Wed, Sep 25, 2013 - 10:13pm

Gold closed up $10.10 to 1333.00 on moderate volume, with silver up +0.08 to 21.78 also on moderate volume.  The gold/silver ratio rose 0.25 to 61.19.  Gold broke above its resistance level of 1332 today at one point reaching 1338.  The move caused a bit of short covering but nothing too dramatic.  Silver rallied as well, but could not break out.  Today was a modest rally; gold broke its pattern of lower highs and lower lows today.  If gold can build on that, then it might drag silver up through its resistance too.

Silver is not looking particularly strong, possibly because oil has also had a bad post Fed No Taper, down $6 over the past 5 days and down $1.07 today to 102.30.  Oil and silver don't move precisely together, but oil dropping undermines any inflation thesis that might provide an additional upside momentum to silver.

The dollar was down -0.27 [-0.33%] today to 80.42, losing the last 3 days of modest upside move in one day.  This may have helped gold a bit.  The buck's rally post Fed No Taper has been very weak.  Next serious support for the buck is at 79.

Mining shares were up today; GDX +1.75% on heavy volume, and GDXJ +4.49% on moderate volume.  GDX was  up 3.4% at one point and the rally lasted until about 2:30 in the afternoon - longer than normal - but it faded seriously in the last 45 minutes of trading.  Traders appear willing to buy the miners, but they just aren't willing to take them home, not yet.  GDX remains well below its 50 day MA.  The picture has improved slightly, but the end of day selling was not bullish.  The shorts still seem to control the game in the mining shares, although the juniors seem to be performing substantially better than the big guys.

Another day up for bonds, and another modest down day for equities.  That's five in a row for SPX.

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