Precious Metals Slide

(06/19/2009)
"Gold traded within a $4 range well into New York on Thursday, hitting a peak of $940 once in Hong Kong and again at mid-morning, but then, as it has of late, sold off through the rest of the Comex, before taking back a little lost ground on the Globex to close at $932.30/oz., down $6.50. Overnight, gold has been flat.

Platinum was locked in between $1,200 and $1,210 all day long, ending at the bottom of the range at $1,201/oz., down $2. Overnight, platinum has edged higher.

Silver really had nothing to recommend it, reaching its high for the day at $14.38 in late Hong Kong trading, then gliding slowly but surely southward throughout the day and closing at $14.19/oz., down 13 cents. Overnight, silver is trending higher.

It was a day of no sharp moves for the precious metals, albeit with a modest down bias. The usual suspects were mixed, with crude pushing slightly higher but the dollar strengthening.

Even the Hightower Report had little to say, writing that, 'The gold market traded on both sides of unchanged today but stayed weaker for most of the afternoon. A better than expected unemployment report did little to support the market today, which is contrary to recent trends, when strong economic data has lent support to equities and precious metals. The equities rallied today, but so did the dollar, and this kept a limit on gold. More talk of potential strike action in South Africa also failed to provide a lift to the market.'

Many analysts are now thinking that gold may have found a floor.

Among them, Russell Browne, strategist at ScotiaMocatta, said that gold 'has found support' near $927 an ounce, which marks a 50% retracement of its rally from $865 in mid-April to $990 this month. Browne cited Fibonacci analysis. Gold traded as low as $925.80 on June 15, but has generally honored its 100-day moving average, currently at $926.41.

That '100-day moving average near $925 has held firm despite a bearish move in gold from $990 to $927,' said Browne."

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