So, apparently it now takes more than 500 tons of paper gold to hit gold (AMEX:GLD) and knock it back away from the central bankers Maginot Line of $1650 per ounce. That is the amount of gold that exchanged hands on the COMEX yesterday starting an hour before Ben Bernanke’s testimony and continued for the next three hours. In four hours a stupendous 515 tons of gold were traded.
Yes, this is purely rational behavior by professional traders.
After wiping out people stupid enough to believe that last Friday’s rally would be sustainable, their work was done. Selling continued into Asia as those on light margin were taken out. the market stabilized and turned on the London open on Friday and continued into the Globex, and weekly, close. Gold closed the day up slightly but down $32 for the week at $1594.35 per ounce.
Bernanke’s commentary killed the short covering rally in the Euro as trade the long dollar/yen/bonds trade got a three day pressure relief rally. But the trend that has been in place in the markets since the beginning of March reasserted itself and the USDX (AMEX:UUP) rose, the Euro sold off and U.S. and Japanese bonds rose. Inexplicably so did stocks as the S&P 500 (AMEX:SPY) and the Dow Jones (AMEX:DIA) both rose on extremely light volume. In fact this week’s rally in U.S. equities happened on the lightest volume of the year. No, nothing suspicious about that.Previous Post » Nokia Rises on Buyout Rumor