by David Brady
Sprott Money
Many attribute the rise in precious metals and miners to the high CPI numbers this week. The truth is that although the numbers were high, they were more or less as expected and the same as the month before. The fact is that GDX bottomed on September 29 and Gold, Silver, and SILJ followed on October 5. What provided the catalyst for the surge in precious metals and miners on Wednesday was the peak and fall in the dollar and the dump in real yields.
The following chart, courtesy of Craig Hemke, shows that the extreme overbought, negatively divergent dollar ran into major resistance at 94.50 and began to fall: