Why the gold and silver slide? Unexpectedly, selling pressure is upon the gold market in these early morning hours. It appears that the metals markets are a day late in reacting to the strong U.S. Retail Sales figures. The retail sales figure jumped 1.1% in the month of March and the most optimistic forecast is for a 0.8% increase next month.
The improved retail sales helped to strengthen the U.S. dollar index, which was a significant factor putting downward price pressure on gold (and silver) this morning. Add in further pressure from profit taking and a corrective pullback from the recent gains when gold prices hit a three week high yesterday.
Selling accelerated sharply after gold prices broke through their 200-day moving average at $1,300 an ounce, having already picked up steam on a break of the 50-day simple moving average at $1,317, and of $1,307, formerly a resistance level.
In the short term, look for further upside support if the Russia-Ukraine crisis continues to escalate. Last night the Ukrainian president ordered his troops to regain control of the cities that pro-Russia rebels had taken over in eastern Ukraine. Additional unrest in the area will likely once again stoke gold and silver demand.
All Things Considered – John’s Commentary:
We are not the least bit concerned by today’s market events. In the long-term we see silver returning back to $50, and gold going to $2,000 and then higher. This price dip is a significant buying opportunity for gold, and especially for silver.
If you have been waiting to buy, in the case of silver, wait no longer. If you are afraid to buy, it is exactly the time you should be buying. If you have enough, don’t lose heart!
Remember, always buy what is OUT of favor, and wait for it to come back IN to favor.
Quote of the day: “If ever there was an area in which to do the exact opposite of that which government and the media urge you to do, that area is the purchasing of gold.” – Robert Ringer
