Gold and silver have hit 6-week highs! What’s happening with these precious metals?
Well, some are saying that they are up on safe-haven demand, on cautious comments from the US Federal Reserve or on on strong seasonal demand. It could honestly be anything and we don’t really care what’s driving these spikes.
There is no point in worrying about what’s causing short-term fluctuations as it will do nothing but mislead you. The main point is that these two metals are bearish and so far, this recent bounce is nothing but short-term bargain hunting.
One can see in the chart above that gold is in a falling market and just last month it fell to record lows (as we expected in October). Focusing in on the long-term picture, we can see that the recent rise should be nothing to worry about yet.
On the other hand, the picture is even more bearish for silver. Silver is barely moving up compared to how much it fell in the past few months.
What This Means For Metal Buyers
Prices do not move in a straight line, they need to move up and down. Gold and silver are rising after falling sharply in the second half. Prices might keep rising in the short-term, but the long-term picture remains bearish and prices could fall more as we get into 2015.