Gold is overbought in our opinion and we think the yellow metal is in for a short term correction. We feel the same way about silver.

The coming drop in gold and silver prices will drag precious metals stocks down with it and so we are taking profits and selling some shares.

Today we reduced our exposure on:

Silver Standard: Sold for an average price of $34.82 (Please Note the negative moving average crossover)
Pan American Silver: Sold for an average price of $36.65

We hereby change our signals on the above stocks from HOLD to TAKE PROFITS. The rest of the stocks in our portfolio are marked HOLD for now.

If you hold any gold or silver itself, via and ETF or via another form, then we think it is a good idea to sell a portion and lock in some profits.

We are still confident in the longer term bull market in gold and silver, but for the short term we see a drop coming and so are stepping aside to let it pass, before buying back in again. The recent rally in gold and silver prices was given one last boost by the Fed rate cut, but we now think that further upside is limited in the short term.

We acknowledge that this will not be popular with all our subscribers as we have received a fair amount of emails disagreeing with our position, even when we were just suggesting a correction. However we must call the market how we see fit, so there you have it.

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