Gold fell to a 5-week low in the April contract overnight in Far East trading to $1,206 dollars per ounce. A stronger dollar index was the main culprit overnight, but as I’m writing my report this morning, gold has recovered, the dollar has weakened and now April gold is back to the $1,220 level.
In the absence of any news regarding interest rates here or abroad, gold just seems to be offered on any rallies.
Supply and demand issues are kinda cold these days, as indicated in the April / June COMEX switch widening out. If there was any indication that the demand for gold was exceeding the supply that switch would be collapsing. Over the last few days it’s been widening or, as we like call it, moving to the right.
The good news is the ETF funds continue to see more and more inflows and now the holdings are above 58 million ounces.
Some financial advisors have reported retail investors now are starting to add Silver ETFs to their portfolios to combine with their gold holdings.
My tech friends tell me that the $1231.50 level in the April contract is the next level of resistance and until some bullish news hits the wires we can expect gold and silver to remain range bound.
Author Name: Walter Pehowich
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