The ECB announced that they would continue asset purchases through the end of the year and reduce the amount of stimulus from 80-Billion to 60-Billion next April. The EURO spiked higher on the news and then immediately sold off; the US Dollar strengthened.

The EURO is close to breaking below long-term support, and we could see prices slide to 95 by April 2017. A weak EURO usually indicates a high dollar and consequently weaker gold prices.

Silver made an interim low at $16.15. If it was and intermediate low, then prices will rally back above the 200-day MA without much opposition. However, if this is just a bear market bounce, then prices will terminate in the resistance box (see chart) and drop sharply below $16.00.

-US DOLLAR- The dollar spiked down after the ECB announcement and ended the day producing a large bullish engulfing pattern. Today may have marked the cycle low.

-EURO- The weekly chart of the EURO looks ready to break the major support level at 105. The next cycle low isn’t due until March/April, and we could see a sharp decline to around the 95 level. A sharp break below 105 could put pressure on gold prices as they usually trade in tandem.

-GOLD- Gold prices are yet to close above the 10-day EMA, and we still need a close above $1,191 to form a swing low.

-SILVER- Prices rallied nicely yesterday into the resistance box. If $16.15 is the intermediate cycle low, then prices won’t have any problem rallying through the 200-day MA ($17.71). However, if $16.15 was just the first common cycle low of a new intermediate trend, then prices will rollover in the resistance box and drop to new lows.

-GDX- The consolidation continues. Prices rallied into the close and managed to end the day above the 10-day EMA. Still no signs of a reversal or breakout in miners.

-GDXJ- Junior miners are still consolidating within a triangle formation.

-SIL- I was surprised to see the silver mining ETF weak relative to spot prices yesterday. Miners usually lead spot prices.

-SPY- The hot money keeps flowing into stocks, and this trend could persist longer than most anticipate.

-WTIC- Consecutive closes below the 10-day EMA will register a top at $52.42, and I would expect prices to drop into January.

If the dollar cycle bottomed today, then the EURO will likely break the critical 105 support level. A sharp selloff in the EURO could usher in another wave of selling in precious metals. Silver and miners breaking below their November lows will strongly advocate that the 8-year bearish forces are in play and that prices will remain weak until early 2017.