We are once again at the cross roads in the Gold and Silver markets. After a big drop they have been consolidating as if waiting to see what the Dollar is going to do. QE3 is off the table for now so the fast money fled the trade, I was expecting a retest of the lows made earlier this year but the markets actually seem like they want to stabilize here. The only decent support I see is that gold is testing the 50 week moving average which comes in around the $1650 area on Comex Futures. As you can see by this chart, that moving average has held any decline for the past several years including the big ones the past few months.

Gold stocks gave a nice buy signal yesterday so I was hoping that gold and silver futures would do the same thing today. So far however, it’s just a choppy day with little direction. Traders seem to be waiting to see if the dollar rally fizzles out here. That will be what saves the day for the precious metals!