The price of gold this morning under pressure as the dollar index approaches the 101 level again and ten year bonds yields advance. At the time of this report the price of gold is trading below the most recent support level at $1,128 and approaching a double bottom in the charts at $1,222. If the selloff continues, Wall Street gold traders tell me that they will be watching for the 100-day moving average at spot $1,216.25 before jumping back into the market. Some indicated this morning that they are happy with their current long position in the market, but see no reason at this level to add any more on. My take is, if the 100-day moving average is violated selling will accelerate bringing new shorts into the market place and the Wall Street longs will have to cover quickly.
Keeping the price of Gold from pulling back further has been the continued support in the Gold ETF arena.
Friday we saw an increase of over 400,000 ounces into the funds. Seems like all commodity fund activity.
Financial advisors still see little or no action by retail investors in the ETF market. Retail investors love affair with equities continues as the Dow Industrial Average looking at a higher opening this morning.
Refiners reporting steady demand from wholesalers and retail coin shops report decent store traffic.
The price of silver seems to have a mind of her own, happy with just hanging around the $18 dollar level. In the event we see a selloff in the gold down to its support levels, silver should follow. My technical friends tell me there is no support level to share with us in silver until $ 17.48 level is met in the March contract.
With the equities so strong this morning, I expect that the first level of support to be tested later today.
I will be watching closely the action in the dollar and ten year treasury yields as they both seem to move
the price of gold every step of the way.
Have a wonderful Monday.
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