Traditionally gold has exhibited an inverse relationship with the U.S. dollar. In other words, if the dollar goes higher, gold goes lower and vise versa.
Today gold and silver are breaking the inverse relationship with the dollar. The dollar is lower and gold has fallen to support at $1700.
As expected, no Smart Money selling is being seen as Smart Money typically does not sell in this range but sells only when gold goes higher. However, the momo crowd is usually a strong buyer in this range. Interestingly not much buying from the momo crowd is being seen this morning even though gold and silver have fallen to major support levels.
Has the momo crowd simply run out of cash to buy gold and silver? This question is of paramount importance in determining the future direction of gold and silver in the medium-term. We will be carefully monitoring the hard data from gold and silver trading from across the world to determine an answer.
Gold futures are at $1701, silver futures are at $33.05, and oil futures are $89.92.
S&P 500 resistance levels are 1410, 1415, and 1424; support levels are 1400, 1380, and 1368.
DJIA futures are up 16 points.