The tumultuous start to the year for equities has once again given investors reason to contemplate having exposure in precious metals.  In the last week, investors have bought nearly 900,000 oz of gold via exchange-traded instruments backed by the metal.  This is the biggest increase in ETF holdings since January of 2015 and demonstrates gold’s safe haven appeal during times of stock market turmoil.  In the official sector, central banks have stayed steadfast in their precious metals strategies with China adding gold to its reserves for the sixth straight month in December.

Despite investors warming up to the precious metals this year in general so far, the Dow Jones surging over 200 points today caused gold and silver to sell off.  The inverse correlation of equities to precious metals has been particularly strong this year and the risk-on sentiment of the broader market today resulted in gold bids evaporating.  The short term momentum is downward but there is support from the third point in a trendline at $1,067.  Resistance is coming in at the double top of yesterday and today at $1,096.  Silver ultimately failed at its 50 day moving average and erased all of yesterday’s gains in today’s session.  It has held for three days in a row at $13.75 and continues to trade on either side of $14.