Gold Consolidates; Silver Breaks Out


". . .this may be the pause before new record highs."

Gold: Gold added 1.1% yesterday—the most in a week—and is up marginally today and trading within 1.3% of its record nominal high last week. Gold appears to be consolidating above $1,200/oz. and this may be the pause before new record highs. Gold also has risen in other currencies and is back above €1,000/oz., as sovereign-debt and economic-growth continue in the eurozone. Gold priced in sterling appears to be consolidating above £800/oz., and the challenging fiscal and economic situation facing the new government will likely weigh on sterling. Gold is currently trading at US$1,235/oz.; and in euro, GBP, CHF and JPY terms, gold is at €1,006/oz., £835/oz., CHF 1,397/oz and JPY 113,221/oz., respectively.

Gold in EUR, 30-Day (Tick)
Gold in EUR, 30-Day (Tick) 6/16/10

Gold in GBP, 30-Day (Tick)
Gold in GBP, 30-Day (Tick) 6/16/10

Markets await important housing and industrial data from the U.S., while the UK will release unemployment data and the eurozone will release CPI for May.

Silver: Currently trading at US$18.59/oz., €15.12/oz. and £12.56/oz. It has risen 0.3% today in USD, even more in other currencies (see Cross Currency Table) and appears to have broken out. It is again looking good technically having broken above $18.50/oz. and showing a mini-reverse head and shoulders pattern. Whether this is another false breakout remains to be seen, but silver's fundamentals remain sound and the belief that it will begin to catch up with gold seems sound.

Platinum Group Metals: Trading at $1,585/oz. and palladium is trading at $477/oz. Rhodium is at $2,425/oz.

Cross Currency Rates at 1030 GMT
Cross Currency Rates (for Gold) 6/16/10

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