You Say Stop And I Say Go Go Go

You Say Stop And I Say Go Go Go

So, sang the Beatles back in the day. They had a point about contradictory flows of feeling and thought, just as we have now in the precious metals markets.

End-of-year fear came scuttling out of the woodwork today, driving equities down and gold up. Even crude oil found something under its feet other than quicksand today.

Risk aversion is common among year-end investors, especially given the long holiday period when no certain trading patterns can expect to hold steady. Short-players also encouraged gold to rise more than $20 in the morning session. It has now backed off those highs and is trading up about $16.

There are a few worries globally. Greece and its newest debt crisis are yet again nagging at EU cohesiveness. In general, any kind of debt crisis throws shivers into traders, but Greece’s problems are very persistent and could lead to further cracks in the union’s façade. And that’s what really worries the financial world.

Other worries include the bubbling Western/Russian conflict and fears about the Middle East and south Asia overall. 

Economically, many analysts are worrying about the ability of the American economy to act solely as the engine to pull the freight train of the rest of the world through a dicey period of poor growth.

Even though the range is fairly wide, gold is trading in one, and it jumps up against 1210 and then hovers just above 1180.

George Gero of RBC made an interesting observation, too, about how funds are "window dressing" their books in the final days of the year, since some are under-invested in gold.

Who knows what investors will be thinking tomorrow? From a strictly fundamental viewpoint, gold is trading approximately the way it should, slightly jumpy and range bound.

Wishing you as always, good trading,