This week the Gold market notched another all-time high as the Globex June contract traded as high as $1476.40 as the sky rocketing price of Crude Oil are fueling the high prices of both Gold and Silver. Higher Crude Oil prices are aiding global inflation and forcing many investors to choose the precious metals as their “safe haven’ alternative investment.
The May Crude Oil futures contract traded as high as $113.21 per barrel as the Libyan and Middle-eastern chaos continues to tighten the flow of the world’s Crude Oil flow. This week May Silver made new 30+ pears highs and broke the $40.00 barrier as well as it traded as high as it traded as high as $40.96.Silver continues to outperform Gold as it’s double status as both a precious metal and an Industrial metal along with its price per ounce in comparison to Gold has made it very alluring to investors.
The precious metals are technically well over-bought however, the global economy as well as the geo-political chaos is the fuel behind these record levels….both markets are in need of a correction. The wedding season in India has also added to physical demand as the jewelers of India try to meet the high demand.
The European Central Bank did indeed raise its benchmark interest rates .25 points up to 1.25 This raise was the projected by most analysts however, there were concerns they would raise it.50 basis as the Euro regions very high inflation rate suggests more rates to follow the Continued debt woes in the European Union especially in Portugal and Ireland have also helped drive the precious metals higher as many savvy Euro investors are choosing Gold and Silver as their investment choice.
It has become more evident that the global investors are more concerned with rising inflation versus rate hikes from the world’s central banks….And as long as the Libyan and Middle-east crisis continues to interrupt the supply of the world’s Crude Oil supply and force prices higher I expect the current market conditions to remain choppy and volatile.
This week the Gold market covered a very vast $47.30 range. Trading High = $1476.40 and a LOW = $1429.10.
MY SWING NUMBERS
JUNE GOLD
RESISTANCE # 2…………….$1488.00
RESISTANCE # 1…………….$1482.00
PIVOT…………………………..$1470.00
SUPPORT # 1………………..$1464.00
SUPPORT # 2………………..$1451.00
MAY SILVER
RESISTANCE # 2……………..$41.90
RESISTANCE # 1……………..$41.42
PIVOT……………………………$40.46
SUPPORT # 1…………………$39.97
SUPPORT # 2…………………$39.45
Mike Daly / Gold Specialist
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