-- Posted Tuesday, 5 May 2009 | Digg This Article
| Source: GoldSeek.com
June Gold: Open= 903.4 High= 916.7 Low= 893.2 Last= 902.2 -1.2
The markets were focused on Ben Bernanke and the upcoming bank stress-test results today. Unfortunately for gold bulls, Bernanke struck a cautious optimistic tone with his words, noting that he does expect to see some growth this year. He did caution that the banking industry still remains in a delicate position and there are scenarios in which some business may be at risk. On a whole, however, he does not expect that any of the nineteen largest banks will need more capital infusions from the US government.
This guarded optimism sapped the overnight strength in the gold market, and prices of the yellow metal faded throughout the day. The only important economic data released tomorrow is the energy stocks and expectations are for builds in inventory, which would not directly support gold.
What news and information is released or leaked tomorrow that could influence the markets is unknown but one would likely suspect to see fairly quiet markets, or a bit of position squaring ahead of Thursday. The Obama Administration, in conjunction with the Fed, is trying to provide the banking industry with a soft landing, though the final result won’t be known until later.
The June futures price for gold failed to take out the previous high on April 27 and thus remains stuck in the downward trend. The correction in gold could be over if prices can buck the trend of lower highs made in the market.
Since the short-term trend in gold is down bulls ought to wait for confirmation of strength before getting long. Near term support comes in near $887. A break below the double-bottom at $865 would suggest a leg down towards the $820 level.
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Thomas Hartmann
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-- Posted Tuesday, 5 May 2009 | Digg This Article | Source: GoldSeek.com
