Monday September 02, 2013 10:34
I received a number of e-mails over the weekend. Doesn’t anyone do the “BBQ” thing on long weekends anymore? The market dropped on Friday and although rare, this may be just an anomaly. The concept of squaring implies a trigger on both sides of the market. The market was over-extended from the long side and the book was just not comfortable enough on the premise of the Syrian story alone. The sell-off in the thinnest market of the year broke gold through $1,400 and knocked almost a $1 off silver.
When President Obama, although convicted towards action, passed the ball to Congress for a decision, the Far East market jumped on the news and took silver to $23.10 and gold to $1,373 before bargain hunters arrived. Silver mounted an impressive rally back over $24 and gold nudged back to the $1,392 level. Technically, gold is in danger having breached the $1,397 level and has downside risk if NY opens here tomorrow.