Gold Sniffs $1600, Settles Higher
After days of bumping up against the $1585 per ounce level gold finally pushed through it in a burst this morning during European session to take a couple of stabs at $1600 before the bulls gave up and rode the day out between $1590 and $1595. Looking at the chart it is obvious that $1585 was seen as an important level to cap the gold price at while the equity markets continue to defy the market’s fundamentals.
Gold still needs to put in first a daily and then weekly close above $1620 to begin flipping the momentum players to the bullish side of the market as opposed to the bearish.
Silver came along for the ride, regaining $29.00 per ounce and settled in around $29.10 per ounce. Silver needs to put in a close above $29.46 per ounce to bring in positive momentum and spark sincere short covering. When that occurs for either metal it will happen in the other and they will begin to move higher faster than many are expecting.
I’ve noticed that the amount of ridiculous stories declaring the gold bull market to be over has dropped off to a trickle after we put in the bottom near $1550 and action during the COMEX hours has begun turning more bullish. We’ll see if they return once we begin approaching $1700 and $1800. At this point that is simply a matter of when not if it will happen. The market is beginning to feel more positive and that feeling will grow once the levels I mentioned above are breached, especially on the weekly level.