Come Out and Play
Gold $395 Silver $5.82 Tuesday 22 June, 3am Sydney
G'day. A late start for me today, sorry. The Offspring concert here in Sydney kicked off at 7:20am New York time. A super gig but missed the first hour or so of the market. My ears are still ringing, but in a good sort of way. On arrival, I find gold basically where it closed on Friday. An Asian inspired dip down below $393 gave buyers a brief opportunity. The dollar was again weaker against most major currencies. New York again provides the fireworks for the day.
Silver got smoked in a couple of minutes. I was chatting to one of my dealers and he commented on how well bid silver was down near 5.90 and that it looked rather attractive. The next price made was 5.86 offered and we freefell to sub $5.80. The main seller was one of the floor brokers, I prefer not to name names sorry, and he certainly wasn't shy ditching whatever he had to do, for whoever. I guess we should see a fair bounce from here but would be a little concerned being long if we head back to $5.70. We have seen very good support at $5.60 and it would surprise if strong consumer/fabricator buying didn't emerge again at those sorts of levels.
Gold also got a little kick down to the $393 level. The currencies didn't move at all and I was scratching the old noggin for a minute. Then it dawned on me as I perused the "commodity" currencies. The Rand was up about 1.65% versus the dollar. A large part of the move occurred in the hour before gold copped a couple on the chin. I can only put 2 and 2 together and I expect we will hear that a South African has sold gold in Rand terms. Just educated guessing, mind you.
India is NOT importing gold at these levels. They don't like sharp moves up, more so when it coincides with a lower Rupee. This makes gold more expensive for locals and it is currently at a 7ish month low against the dollar. So that rules them out as buyers up here for a few days, until they get "re-comfortable" up here. Funds were solid buyers on Friday and would suggest dips will be attractive to those who missed the boat last week. Still good selling above and $396-8 is proving a tough nut to crack. Support at $392 then 388.
I suppose we should be watching the currencies for clues going forward, and I am heartened by the amount of chatter regarding inflation. "Unconcerned but vigilant", I thought I heard come from a Central banker in the ECB over the Bloomies terminal. Maybe I misheard.... And today would be the day for it.... Ears still ringing!
Short and sweet today, sorry....Gotta fly......
Enjoy the rest of your day....
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