Monday, November 1, 2010
Gold This Morning: Overture to Reality --Jon
Modestly active turnover with a firm opening and just one dingy attempt to probe lower prices. Friday's regular weekly COT (Commitment of Traders) announcement saw and very surprisingly (since they usually offset each other) significant liquidation by both large specs and commercials. In fact the net reduction from both sales and short covering accounted for a great deal of the ~5% contraction in open interest in the active DEC contract. Small specs were buyers for the first time in several weeks with that number offset by a similar amount of short selling. The GSR eased further to ~54.70; RSI even with the weekend strength remains in the low 60s, hardly conducive to bears trying to play the 'overbought' card. Today: As usual deal with the facts...there is liquidity, buying power, and friendly technicals. Expect continuing frenzied analysis from intoxicated commentators for the next 55 hours or so as they assimilate election results and FED conclusions. There are copious glib assessments that markets, which are always leading indicators, have already discounted current events...don't count on it.