Euro/$ puts pressure on gold and silver

Weakness in the European economy, especially the money market, seems to be intensifying. Yesterday's global central bank coordination announcement revealed more serious liquidity problems (or as some say, insolvency) among banks in Europe. So I think this announcement may have created more fear, at least in Europe, rather than soothe the markets. Consequently, the euro is currently under a lot of pressure (shown below), which is also having an impact on gold and silver. Despite yesterday's rally, sparked by the Fed's new plans for capital injection, it is important to remember that the Fed still disappointed market expectations concerning the fed funds rate. A euro sell-off may very well bring gold and silver down to $760 and $13.5. Retail sales are expected to come out strong, while inflation numbers are expected to come out high. So watch out for a sell-off in euro, gold, and silver!