Has the G-20’s Loose Vows for Fiscal Responsibility Prevented Gold from a New Record High?
Spot Gold – $1,239.05 // -$16.55 // -1.32% A record high was within reach for gold traders this morning; yet an intraday rally on the open of US banking hours would immediately fizzle and ultimate turn into a $27 peak-to-trough reversal. If there were any need of evidence that this particular security is deviating from the normal risk appetite/aversion track, today’s performance would confirm it. Through the trading day, risk appetite was either positive or unchanged; and yet, the traditionally safe-haven metal would actually tumble through the opening hours of the US session. The expiration of the active June 2010 COMEX futures contract and rollover to the next liquid alternative no doubt had its impact on price action (hence the sizable drop at the open of the New York session). This likely reflects a considerable front-end interest in the futures market whereby a greater segment of the speculative crowd is holding off from buying the physical at near record prices. That being said,
