Kitco daily market comment

By Jon Nadler
After yesterday's landslide in values, they are in a daze, trying to pick up the pieces. Call it year-end tax selling/window dressing blowouts, call it Fiscal Schmiscal, call it QE fatigue. The results are the same: votes of no confidence translating into li-qui-da-tion. The 'mystery' seller(s) are a figment of someone's overactive imagination. After all, the washout happened at a time when the Cliff appeared promising, Asia was closed, the dollar was down, the euro was up (still is), etc.

Now, like I said the other day, when you have only a handful of players in the office and sell stops are hit, the Whack-A-Mole game gets pretty brutal. At the end of the day, the larger downtrend, in place since 2011's September high, was being somewhat (make that totally) ignored and the whole year was spent rooting for QE and its effects. Bad move. Net gain ytd: 3.9%. That, my friends, is TEN percentage points under what the bulls had gotten accustomed to over the past several years (annualized). Surprise. What goes up.

That said, there is a school of gold thought that envisions a fast pop to 1900 (maybe more) before Feb and then THE slide to 1250-1450. Stay in school.

Regards to all,

(The author is the senior metals analyst - Kitco metals)