Gold, Silver and Crude Oil Trade
US Gold futures ended pit trade higher, and near the high on Thursday. Traders and investors came in to buy the dip in Gold, with strong short covering and bargain hunting in an oversold market due for a bounce
Jun Gold last traded + 37.00 at 1,573.60 oz.
Spot Gold was last quoted + 33.60 at 1,574.50 oz.
July Comex Silver last traded + 0.814 at 28.01 oz.
The market pick-up in risk appetite Thursday morning followed Wednesday's release of the minutes of the latest meeting of the Federal Open Market Committee (FMOC), which signaled that further quantitative easing (QE) of US monetary policy is not off the table.
Then the Philadelphia Federal Reserve business survey was released Thursday, coming in weaker than expected. That cracked the gains in the USD index and US stock market, rallied US Treasuries, and was a reason for traders to do some Short covering and buy Gold.
Thursday's gains in Gold came on the back of an overall risk-off day in the overall market, following the Phili- Fed survey. The big gains in Gold suggest that some of the precious Yellow metal's gains related to safe-haven demand.
For the Gold Bulls, they needed to see a day of solid, corrective upside price action and they got it as prices neared the Key technical mark at 1,500.00. A move below that major psych support mark would begin to inflict some chart damage, and would call into question the 11-yr old price up-trend. The up-trend remains in place on the longer-term charts.
Gold prices around this week's low also mark a 20% decline from the all-time highs marked last year. Many market watchers determine a Bear market to be in place when a market price has backed off by 20%.
The EU debt and financial crisis is still in the headlights. The Fitch ratings agency Thursday further downgraded Greece's debt rating. After Tuesday's failed efforts by Greek politicians to form a coalition government, new Greek elections are now scheduled for mid-June.
Concerns regarding Greece leaving the EuroZone are high, as the Greeks' commitment to financial austerity is questionable. Spanish and Italian bond yields are above 6%, stressing the EU financial system.
The USD index traded steady Thursday after hitting a 4 month high overnight. The Greenback has benefited recently from safe-haven demand mainly due to the EU situation.
The USD index Bulls have good upside near-term technical momentum in here.
Crude Oil futures prices were slightly lower on Thursday after prices Wednesday hit a 6.5-month low at 91.81 bbl.
Crude Oil is in a Bearish fundamental and technical mode. If Crude Oil continues to trend lower, and the USD index continues to trend higher, sustainable near-term price up-trends in Gold and Silver could be difficult unless more solid safe-haven demand for Gold comes into play
The London PM Gold fixing at 1,554.00 vs the previous London PM fixing at 1,548.50.
Economist Shayne Heffernan of www.livetradingnews.com Market Outlook
Paul A. Ebeling, Jnr.
Paul A. Ebeling, Jnr. writes and publishes The Red Roadmaster's Technical Report on the US Major Market Indices, a weekly, highly-regarded financial market letter, read by opinion makers, business leaders and organizations around the world.
Paul A. Ebeling, Jnr has studied the global financial and stock markets since 1984, following a successful business career that included investment banking, and market and business analysis. He is a specialist in equities/commodities, and an accomplished chart reader who advises technicians with regard to Major Indices Resistance/Support Levels.