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Comex Selling Stymies Gold’s Advance

ByGoldMoney News Desk
Published 10/10/2012, 07:33 AM
Updated 05/14/2017, 06:45 AM
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Frau Merkel’s (swift) visit to Athens yesterday coincided with another weak day for the euro, which is now trading below $1.29, while yields on Spanish debt have nudged up by a couple of basis points. A new report out from the IMF has thrown yet more cold water on global growth prospects, sending the FTSE All-World index down around 0.3%. Meanwhile, gold and silver succumbed to selling pressure at the Comex, with gold dropping dipping towards $1,760 and silver down to $33.60 before recovering.

As Alasdair Macleod discussed the other day, the current setup in the gold futures market pits speculative “longs” against commercial “shorts.” The latter won a small victory yesterday, and have stymied the post-QE3 momentum we had in these markets. This will change again soon; Dan Norcini discusses the current technical setup in gold and silver futures in more detail over at KingWorldNews. As he comments, gold – and by extension silver – will be well supported on any forays below $1,750, owing to central bank buying and short-covering at the Comex.

Meanwhile, the IMF has got the euro’s back – or at least, that’s the impression furthered by the body’s Deputy Managing Director David Lipton, who made various supportive comments aimed in the direction of the eurozone yesterday. Agreements to boost the IMF’s lending capacity to $456 billion are being finalised in Tokyo this week. Combined with the unlimited money printing we’re now seeing from central banks all over the world, this will have a good chance of sustaining the eurozone in its present form.

Coordinated inflation is the medicine that’s been chosen the save the financial system; the question is whether the inevitable rampant inflation that follows ends up killing the patient.

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