Gold consolidates: but for how long?

Perhaps global economic ills will be put on pause for the summer. But the entire investment world will be looking for the dip to buy the best performing asset of recent months — GOLD

In a continuing consolidation, gold and silver sold off this week. In European trading hours this morning, gold was $3206, down $74 from last Friday’s close and silver at $32.25 was down only 43 cents. The gold/silver ratio is back under 100 at 99.4.

As proof that western capital markets no longer determine gold and silver prices, declines this week have been during Far East trading hours. While trading on the Globex facility by Westerners cannot be ruled out, the fact that moves happen during Shanghai trading hours should be noted. And while SGE physical deliveries have increased (153.05 tonnes in April v. 120.16 in March) it would appear that leveraged futures in Shanghai are causing some market indigestion.