Trading resumed Sunday a bit later than usual as a technical problem with the Globex trading platform delayed the open by four hours. When trading did resume, physical demand in Asia was very light and with London closed Monday for a bank holiday overall volume to this point has been very low. Trading in the U.S. begins with all four precious metals marginally lower as U.S. equities are poised to open higher following a sharp rally in the German DAX Index. The Jackson Hole conference produced several headlines as German and Japanese officials intimated that their economies may require new stimulus packages this year. Fed Chair Yellen, who has moved away from her very dovish stance in the past month or two, made a comment that job creation and the labor market could be severely impacted by rising interest rates before further improvements in the economy are seen. If rates do stay at current levels well into 2015, it could curb the USD rally which should benefit gold. Trading conditions are likely to be thin this week as many participants take vacation as the unofficial end to the summer season is upon us. A short covering rally at this point does not feel like it is in the cards unless we receive an unforeseen news event. A test of $1,250.00 for gold, which likely takes silver below $19.00, is the more likely scenario especially if the equity market continues to rally as we approach month end.
Posted on: Mon, 25 Aug 2014 15:03:10 +0000
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