Compiled 06/06/12 6:00 AM (CT) Statistics: London Gold Fix $1,633.25 LME Copper Stocks 231,200 tons +325 tons GOLD MARKET FUNDAMENTALS: (6:00 AM CST) A noted range up extension and definitive upside breakout on the charts in August gold this morning would seem to confirm renewed bullish interest in gold. The gold market seems to be drafting most of its current strength off anticipation of easing from the ECB and with that decision due in early this morning at 6:45 central standard time, one could suggest that gold is already pricing in at least a portion of an easing move. Technical traders are also suggesting August gold, with the overnight move, has broken out above a somewhat critical longer down trend channel resistance line on the charts and it has recently climbed above a 50 day moving average and some might suggest that it is seemingly working its way up toward the 100 day moving average up at the $1,669 level. Somewhat supportive currency market action might also be contributing to the upward track in gold prices and there is also talk that the US Fed is considering some easing action and that development could add to the bulls existing case. Dampening the upward track in gold prices this morning is a downward revision in a European GDP reading, reports of increased Asian scrap gold sales and talk of ongoing sluggish Asian physical demand. In the end, the gold market wants and needs to see one or perhaps two additional central bank easing moves to leave the bull camp happy. Comex Gold Stocks were 11.007 million ounces up 11,864 ounces. OUTSIDE MARKET DEVELOPMENTS: (6:00 AM CST) Hong Kong shares managed more short covering gains overnight, while Shanghai equities simply marked time again on the charts. European equity markets were higher overnight off hopes of something positive from the ECB meeting early this morning. Early US equity market action was posting definitive gains, as there are expectations of central bank assistance in the air. Seeing a downward revision in Euro zone GDP readings overnight probably increased the hope of easing from the ECB. The US economic report slate today is rather thin, with a weekly mortgage application survey due out early, a couple Fed speeches due out during market hours and a Fed Beige Book scheduled for release in the early US afternoon trade. In general, there appears to be an attempt to fan risk-on sentiment but the question is whether or not the ECB meeting will contribute to that theme or detract from that theme.
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