Precious Metals To Continue Getting Pummeled (And What It Means For Oil)
Tim Knight | Nov 03, 2014 12:24AM ET
In mid-September, just about six weeks ago, Silver failed beneath an important shelf of support (tinted in yellow below). Although silver was already in a downtrend, once support was broken, pretty much all hell broke loose (via iShares Silver Trust (ARCA:SLV)).
I was watching for a similar break in Gold. That break has now happened which means, regrettably, that “precious” metals are probably going to continue to get pummeled. It is supremely ironic to me that the asset that is appreciating handsomely in value is the piece of cotton paper in your wallet with green ink smeared on it.
The “warning” I think this provides pertains not to a metal, but to Oil itself. With oil’s bear market all these months, it may seem obvious that oil is about to roar higher. Maybe, maybe not. What I think is a strong possibility, though, is that in the months ahead, you’ll see oil fail its shelf of support just as gold and silver did beforehand. (Via United States Oil Fund (NYSE:USO))
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