Gold bugs have been waiting for this day patiently since the February 29th drive-by shooting that the FOMC pulled off; reversing monetary policy and pushing the markets towards the state we’ve arrived at to end this week:
- Europe on the brink of financial collapse
- The U.S. economy rolling over as economic indicators retreat.
- Capital is flying out of European banks at their fastest pace since the 1920′s
- Yields on U.S. treasuries (AMEX:TLT) are reaching record levels
Amidst this background Gold (AMEX:GLD) has been caught in a vicious downtrend that has made even some of the staunchest gold bulls question not only their sanity but, more importantly, their investment thesis. On Friday, the U.S. Non Farm Payroll Number was released and it missed consensus estimates by nearly 100,000 jobs. If not for a record birth/death adjustment of +204,000 the print would have been catastrophically worse. That was enough to finally put the bears into full retreat and gold moved up nearly 4% on the day, closing the week at $1625.65 per ounce. Now, of course, this is one day after the end of May where longs who tried to stand for delivery were crushed by $100 per ounce.
The COMEX (NYSE:CME) has staved off a commercial signal failure for another 30 days, let’s see what they have up their sleeves for the last week of June…. maybe something like the application of sanctions by the U.S. versus any country still trading with Iran? That, conveniently, happens on June 28th.
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