I will let trader Dan cover gold today, my commentary is getting pretty dull as the charts aren’t changing much. Gold is really impressing me the way it is holding the 1500 level. I think we are truly building a strong base to launch from.
The same concerns that are sending equity market bulls scurrying for cover, namely, European sovereign debt fears and a growing sense that an overall slowdown in the global economy is coming, are sending gold higher in a display of resilience which undoubtedly been causing a lot of anxst among gold bears.
Take a look at the following charts to see the remarkable performance of the yellow metal.
Meanwhile, U S Dollar priced gold has clawed its way back towards heavy resistance near the $1520 level. If gold can take this out and hold above it for a few hours, it sets up a run towards $1530, which is the last barrier standing between it and $1550.
Initial support has moved up towards $1500 which is acting as a floor right now. One has to be tremendously impressed with the strength in gold coming in the face of a Dollar that has breached overhead chart resistance and a sharp move lower in the US equity markets. Additionally, the brainless hedge fund algorithms are busy throwing away anything looking remotely like a commodity today (no one is going to eat since the stock market is falling) which is not having any impact on gold whatsoever. It truly is functioning like a safe haven.
Also, while the equity market weakness is weighing on the mining shares, both the HUI and the XAU continue to hold above recent lows.