Roy’s Commentary 11/30/15

Precious metals prices were under pressure while the U.S. market was enjoying the Thanksgiving holiday as the USD continued to strengthen, having broken through the 1.06 level verse the Euro. On the back of this, gold moved lower and took a run at $1,050.00 on the way to recording a low of $1,053.00.  Physical demand seems to have offset the selling pressure for the moment and this morning finds gold back above $1,060.00 while silver continues to trade above $14.00. As we enter the homestretch for 2015, gold and company continue to feel vulnerable. As the USD continues to strengthen, long term long positions continue to be liquidated as witnessed by recent CFTC and ETF data. In addition, speculative short sellers continue to pressure our market despite increased physical demand. On the downside, gold should find support from $1,050.00 through $1,025.00 but a break below this band could see gold prices beginning with a “9” in a hurry. On the upside, there are signs of base metals prices stabilizing as Chinese producers are cutting production, while there is talk that the government is looking to increase their strategic stockpile of aluminum and perhaps other metals. A year-end rally in base metals would certainly add support to our market. A break above stiff resistance in gold from $1,070.00 through $1,085.00 could see us re-visiting $1,125.00 through $1,140.00