Mike's Mid Day Minute is available to members on Monday, Wednesday & Friday evenings, with one article per week available to non-members. Members please login and see "Mike's Mid Day Minute" in the navigation menu towards the top of the page.
Upside Reversal for Gold
Very interesting that spot gold pierced its prior low early today, but has since reversed strongly by about $30/ounce and into positive territory despite downside continuation in the Euro/USD to new multi-month lows.
Yes, my pet theory has been that at some point sooner than later, gold will become increasingly "used" as a flight-to-safety vehicle as Treasury bond yields press lower and lower. As we speak, U.S. 10-year T-bond yield is pressing on 1.62%, breaking last September's low of 1.68%, corresponding to an upmove in the iShares Barclays 20+ Year Treas Bond (TLT). This move appears to have coincided with the upside reversal in spot gold, regardless of the negative influence of the Euro/USD.
Let's understand, however, that to confirm that spot gold has established a significant low and has emerged from an otherwise sideways congestion area, it must hurdle $1584.20. Right now, spot gold and its ETF, the SPDR Gold Shares (GLD), are acting great, but still remain "in the middle of nowhere" from a pattern perspective.
