Market Overview: The precious metals complex is mixed today in light holiday trade,
with gold declining while silver sees a little buying. Volumes are likely to be extremely
light today following the Thanksgiving Holiday yesterday, as most investors take
advantage of the long weekend. Gold and silver investors are in need of some bullish
news, but for the time being it appears that these precious metals may have a difficult
time putting together any sustainable rally given stronger equities and a stronger U.S.
Dollar index. A Fed interest rate hike next month now appears to be a near-certainty,
with Fed Funds futures pricing in a 100 percent chance of a rate hike from the central
bank. The gold and silver markets have likely fully discounted this hike already, and
perhaps once the hike takes place these metals will find some more buying interest.

Key Data Points: The latest reading on PMI Services Flash this morning showed a
reading of 54.7 and signaled U.S. service sector growth holding steady.

Outside Markets: Stocks are slightly higher in light trade today as crude oil and the
dollar both decline. As risk appetite has remained elevated, stocks have been marching
on to fresh all-time highs, and could have further room to run.

Equities have been on a tear since the surprise Presidential Election victory of Donald
Trump, as hopes for fiscal spending and tax cuts have fueled economic optimism.
Markets may, however, be getting a little long in the tooth, and while further upside is
possible, a pullback could potentially be seen before any significant move higher from
current levels.

The Dollar Index has also been a major factor for the gold and silver markets in recent
action, and like equities, the dollar could have further room to run higher. The
greenback is currently trading at the highest levels since the early 2000s, and further
strength in the currency may impede any potential rallies of significance in the precious
metals complex.

The Big Picture: Risk appetite remains high, and stronger equities and a stronger
dollar are taking a toll on gold and silver. As sentiment surrounding these precious
metals becomes more and more bearish, the markets could be getting closer to finding
a meaningful bottom. It does not appear, however, that such a bottom has been
reached yet. Gold and silver are likely to remain on the defensive for the time being, and
could potentially find a bottom when the Fed actually lifts rates next month.