Comex Gold Soars on Fresh Safe-Haven Buying, Panic Short Covering
By Jim Wyckoff
Comex gold futures prices are trading sharply higher and have soared to a fresh three-week high in the aftermath of a much-weaker-than-expected U.S. jobs report that has quickly put U.S. quantitative easing of monetary policy back on the table. August gold futures have pushed above what was stiff psychological resistance at the $1,600.00 level. U.S. non-farm payrolls rose by just 69,000 in May, which is much less than the 150,000 rise expected by the market place. U.S. stock indexes slumped, U.S. Treasury bond and note futures prices soared and the U.S. dollar index vacillated but did back down in the wake of the jobs data. Friday morning’s gains in gold come on panic short covering, bargain hunting and solid fresh safe-haven investment demand. The weak U.S. jobs data combined with the very uneasy status of the European Union and a weakening Chinese economy have played right into the hands of the gold market bulls. The bulls have gained fresh upside technical momentum as price action Friday is scoring a bullish “outside day” up on the daily bar chart–whereby the high is higher and low is lower than the previous session’s trading range, with a higher last trade. Prices are also poised to close at a technically bullish weekly high close on Friday. Look for volatile trading in the precious metals and other markets as the trading sessions progresses Friday. August gold last traded up $39.30 an ounce at $1,603.30.