Gold Ends the Month Up, Stablilizing near $1720
The estimates for damages done by Hurricane Sandy are growing well north of $50 billion and between that and the loss of function for much of the Eastern seaboard will have the central banks in ctrl-p mode, so much so that even though today was futures expiration for the November delivery contract, Gold was able to rally back above $1720 an ounce. Beyond the after-effects of sandy, strength in the Euro as well as QE/stimulus programs by both Japan and China while the COMEX slept had pent-up demand for metals and commodities far above the comfort zone of the most bearish of shorts.
Gold rallied coming into the European open last night and ran into a wall of selling near $1722 for the rest of the day. A close this week above $1731 would be bullish and likely signal an end to this seven week consolidation. But as of right now, Gold is not giving any strong signals intra-week as to which way it wants to go. $1731 is last week’s COMEX high, and if gold can close above that it would dissipate a lot of bearish sentiment and momentum; giving the shorts some pause before piling on. With Apple and the S&P under pressure to hold $600 and 1400 there might not be enough money out there to hold Gold back from where it obviously wants to go.
I still feel the markets are being completely managed in the run up to the presidential election on Tuesday so looking for trend reversal signs in this environment is tricky at best.