Precious metals opened the trading week yesterday via the electronic trading platform on the defensive as the first move was lower. This was followed by physical demand throughout the Asian morning as all four precious metals turned positive where they stayed through the balance of their Monday. Gold took a run at $1,250.00 in London this morning, but so far the resistance band has held and early U.S. trading sees gold looking for direction as it drifts around $1,245.00.
U.S. equities are poised to open lower but most of this 100-point drop is on the back of I.B.M. which reported a dreadful third quarter and is down over 8.00 percent in the pre-market. Bonds and crude oil are heading for a quiet open and are unlikely to have an impact on precious metals which may account for the light volume we are seeing, especially for a Monday. The week begins with gold support at the 10-day moving average at $1,231.00 while resistance stands at the 50-day average at $1,249.50. Gold moves to the downside and is likely to be well supported by physical demand through $1,215.00 while a break above the 50-day average sets us up for a test of the 100-day moving average at $1,274.50.
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