Market Commentary – July 3, 2014 Gold finished the week a touch lower in quiet trading, with the positive jobs reports weighing gold down early in the session, and book squaring over a long weekend underpinning any sustained downward movement. Opening $1322.50 in the Far East, gold moved in a range of $1320 - $1324 for the Asian session. London took the market lower late in their day, falling to $1318 on a slightly higher U.S. Dollar as the European Central Bank kept interest rates unchanged (not totally unexpected) and European PMI slipped slightly. New York sold gold off to the low of $1309.50 in rapid style following the surprisingly positive Non-Farm Payroll number of 288K new jobs (cons. 211K) and the Unemployment Level dropping to a near six year low of 6.1% (cons. 6.3%). However, gold recovered briskly, rising back above $1315 in a matter of minutes and eventually rising to above $1320 on short covering as the market failed to crack on the eve of a long weekend. Falling back to $1317 as the U.S. equity markets closed in record territory, gold settled in for the remainder of the afternoon on either side of $1320, finishing prior to the long weekend at $1319.50. More positive economic news weighed on the market today, with gold showing some cracks in its recent strong deportment. The market is long, hoping that geopolitical events will prompt further safe haven buying. In addition, bulls hope that the record breaking run in the equity markets will take a breather and trigger diversification to the metals markets. That remains to be seen. However, given all that is going on in the world, it is a brave soul who dares “shorting” this market at the present time, even though logically it may be the right move. It is a “guns” (Ukraine, Iraq, Israel) or “butter” (equities, job growth, consumer spending) choice at this juncture, but not in the way that most of us were taught in economics. Have a pleasant 4th of July. Remember to cherish your freedom. Michael Mikolay Disclaimer – Statements of news and current events on this web site, and financial, economic, political and market information on this web site (individually and collectively “Content”) are not intended to and do not constitute investment advice and are not intended to and do not constitute a prediction of the future course of the economy or the market for precious metals. The accuracy, completeness, adequacy or currency of the Content is not warranted or guaranteed in any way. Your use of Content on this web site or materials linked from this web site is at your own risk.
Posted on: Thu, 03 Jul 2014 20:45:25 +0000
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