After yesterday’s relief rally on optimism, seemingly from nowhere, that Europe’s troubles are magically mixed, gold drops 1% overnight and currently sits at some decent support at $1800:

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In £ terms gold is about £10 higher than its support level of £1140:

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In Euro terms gold has also dropped but is still about €30 above support at €1285:

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The gold:silver ratio is 1:45

We’re sure it wont be long until the relief rally in stocks fade and more bad news raises its head once again on the banking sector, resulting in a dive for safety in gold.

In fact we’ve already had the first bit of bad bank news of the morning with this headline from Bloomberg:

UBS Says It Had $2B Loss From Unauthorized Trading

Chances are that wont be the only bit of ‘left-field’ banking news we get today, as Europe’s woes are still firmly in focus – no matter what that rally in equities told us yesterday.