PM Daily Market Commentary - 6/26/2014

By davefairtex on Fri, Jun 27, 2014 - 12:36am

Gold closed down -1.50 to 1317.80 on moderately heavy volume; silver was up +0.11 to 21.12 on heavy volume.  PM sold off during asia and london trading, only to rally back starting at 0800 in NY, resulting in the 5th almost-flat day for gold and yet another modest up-day for silver.  Volume on silver's irresistable climb higher has remained quite high.

The gold/silver ratio has dropped to 62.40, down from the high of 67.50 set back in May.

I'm guessing that a bunch of COMEX silver traders have tried going short at these levels, only to be stopped out as silver not only fails to correct but slowly moves higher instead.  Every single dip has been bought.  It will be interesting to see the COT report tomorrow to see just how many managed money short positions remain.  Here's a chart of silver, just so you longs can gloat:

Can anyone identify what changed on June 9th to cause this whole thing to happen?  I certainly don't know.  Someone, somewhere, decided that they really needed more COMEX silver contracts.  And up we went.

The buck was unchanged today.

Mining shares moved up, with GDX up +0.74% on moderate volume, and GDXJ up +0.22% on light volume.  While the miner equity prices rose today, the light volume was not bullish, with GDXJ looking particularly weak.  My guess is, traders interested in mining shares are awaiting a correction in the metal and so are not particularly eager to jump in there until they see one.

The SPX was hit early for a 10 point loss right after market open, but dip-buyers appeared and pushed prices slowly back up; SPX closed down only -2 to 1957.  VIX was mostly unchanged.

TLT (bonds) continued their rally, up +0.48%.

Brent crude dropped today, down -0.79 to 113.21, pulling back more emphatically from its peak.


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