1396.25/1397.25. Profit taking over worries about Japan quickly took
the metal to an intraday low of 1381.10/1382.10. As the selling frenzy
subsided, renewed buying interest brought gold back up to an intraday
high of 1403.25/1404.25 mid session. Unable to find support at this
level, the metal eased back quietly to close the day at 1392.50/1393.50.
Commodities overall being down on Japanese worries, silver opened
the day significantly lower at 33.77/33.81, quickly reaching an intraday
low of 33.57/33.61. Buying interest as crude and base metals began to
reverse their slide lower took silver to an intraday high of 34.80/34.84
mid session. As with gold, another round of profit taking took the metal
to its close of 34.12/34.16.
Technical Commentary
A risk aversion induced rally in the USD has put significant downward
pressure on gold. The metal dropped rapidly through several layers of
support, with support only being found at the 100-day moving average
of 1379. After today's test, this level has strengthened and gold will now
require a significant catalyst to break below here. Should downward
pressure emerge again tomorrow, the risk is that gold will test down to
the psychologically important $1,350.
Silver also had a technically bearish day, however the chart continues
to be more encouraging than gold's. Support for the metal lies at late
February congestion of $32.15, followed by the 50-day moving average
of $30.96. The MACD has turned bearish, but most other technical
studies are still clinging to bullish signals. Tomorrow's trading pattern
will be key. Confirmation of today's down move would open up the
potential of more selling.
Market Commentary
Gold marginally improved overnight, opening at
1674.25/1675.25, before dipping to an intraday low of
1672.00/1673.00. A quick recovery had the metal trading up to
a high of 1679.50/1680.50, before an extended period of range
trading. The metal returned to its high late in the session before
concluding the day at 1678.00/1679.00.
Silver commenced the day virtually unchanged at 31.80/31.85,
before dropping to a low of 31.58/31.63 as the dollar extended
gains. A slow recovery alongside gold until end of day interest
pushed the metal to a high of 31.87/31.92 just prior to
concluding the session at 31.83/31.88.
Technical Commentary
Gold is firmer today at current 1677. The price of Gold has been
trapped between 1652 and 1695 for a month. The market
appears to be building a base with price working on its second
consecutive up week. We do not expect any speculative buying
until the market can break 1695 - a level which has held since
mid December.
Silver is largely unchanged today at current 31.84. Silver looks
bid overall with price making higher lows over the past week.
Key levels for Silver lie at 31.40 and 32.06 on a triangular
formation. A break of either side yields 30.75 or 32.46. The Gold
Silver ratio is higher today at 52.68. The ratio seems to have
found a base at the 52.29 level after falling from 55.46 over the
course of January. We are still bearish Gold Silver while it holds
below 53.56.
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