Gold opened on its lows at 1053.00/1054.00 and quickly rallied as the session started, finding resistance near 1057.00. Construction spending and pending home sales surpassed expectations causing equity markets to rally and gold quickly followed. Good buying carried the metal to an intraday high of 1062.80/1063.80.
Profit taking took it lower and the selling was persistent, finally closing just above its lows at 1053.25/1054.25. Silver opened at 1648.00/1651.00 in New York. Investor selling dragged the metal lower, finding support near 1645.00. It became range bound until positive housing data caused equity markets, oil and base metals to quickly rally and silver spiked, peaking at 1671.00/1673.00.
It retreated from its highs on the back of profit taking and continued to give back ground as the session unwound, closing on its lows at 1639.00/1642.00.
Gold made a nice move up today to current 1055 from Fridays 1043 close. We turned bearish Gold on the weekly chart Friday but hold a Neutral view on the Daily chart. Topside resistance levels show 1067 and 1070. A close above 1070 will bring in stop loss buying of the metal. Down side support is seen at 1043 and 1027. Our view is that Gold stays within the 1027to 1070 range this week with a downward bias (i.e. a down week).
Silver held a top side bounce to 16.71 and is ending the day close to 16.40. Silver remains weak, especially on the North America only chart. 16.12 offers initial support but we believe the risk is for a test on former major support 15.94. The Gold Silver ratio continues to push to fresh highs 64.41. Our next target is 65.16 which is the 50% retracement of the 71.91 to 58.41 down move.
