Gold weakens sharply today as selling against Euro picks up again after XAU/EUR breaks 1030 level. Markets are dominated by reverse safe haven flows. The development drags comex gold futures sharply lower from yesterday's high of 1392.9 and comex gold is now trading near to 1370 level. Such development also indicates that recent choppy recovery in gold is possibly finished and we'd be anticipating deeper fall to have another test on 1350 support level. Silver also follows fold down and is back below 29 and is possibly resuming recent fall.
Crude oil, on the other hand, bounced off from 92 level after failing recent high of 92.58 and retreats today. Yesterday's disappointing initial jobless claim data, which jumped back to 445k, raised concern on the sustainability of US recovery and thus on demand for energy. Also, there are speculation that US refineries will boost supply after an end-of-year clearing of stockpiles. In other news, Alyeska Pipeline Service plans to shut the trans-alaska system today to install a bypass following a leak on the line that carries 15 percent of U.S. crude oil production.
The break of 1029.48 support in XAU/EUR suggests that rise from 945.43 is finished at 1076.13 after completing a head and shoulder reversal pattern. Daily MACD's break of the rising trendline also raises the possibility that whole rise from 886.21 is completed today. We're turning near term bearish in XAU/EUR and would expect deeper fall towards 1000 psychological level. Such development will possibly limit XAU/USD as well as comex gold futures. Meanwhile, note that a break of 1350 support in comex gold will likely trigger even deeper selloff in gold and in that case, XAU/EUR would likely be hammered through 1000 level with ease.