Gold

The old adage “buy on the rumor, sell on the fact” was turned on its ear today as rumors fueled the tanking of gold and silver; equities in the U.S. and Europe; and crude oil.

Call it sentiment. Call it mood, or a sixth sense. Sometimes traders and investors act out in strange and wondrous ways.

Let’s try to make sense as to why the entire precious metals complex fell hard today led by silver, which was off not quite 1.00%. Gold was also off – by 0.60%. A gyrating dollar is having some impact on the precious metals but that was scarcely the bigger problem.

After the release of the Federal Reserve’s 12-district, July-August “Beige Book,” one might have expected a strong upward movement in gold and silver. That was not to be.

Instead, we saw mild profit-taking combine with a slightly higher U.S. dollar to pressure the precious metals. On the equities side, the reaction was also essentially one of lethargy.

The dollar tumbled after a poor showing in data released by the Institute of Supply Management. The data reflected the slowest growth in six-plus years in the service sector. That, in turn, lowered expectations for an interest-rate hike by the Federal Reserve. Of course, that depressed the dollar.

The big news today governing fundamentals was the fair-to-middling jobs report issued by the U.S. Department of Labor.

No thanks to regular trading, gold took back some of its recent losses today, rising about 0.37%. It was all done on the back of a softer U.S. dollar. Silver did far better, rising on regular trading as well as the weakness in the greenback.

There are a number of reasons why gold trades lower or higher on a given day. Logically, we know that it can be a combination of factors. Today, we have but one.

Gold is off quite modestly we might note – about $2.50 at 4PM in New York.

Today we have to contemplate whether consumer confidence, that is the public’s “attitude” toward cutting loose and stoking the fires of higher spending, is an idea or a reality.

Gold Struggles Because Of Higher Dollar But Does Move Higher

There was a fairly important data release today that affected markets, although it will probably take another day before it is completely absorbed.

It seemed like business as usual today in the various markets that make the world go ´round.

The U.S. dollar was certainly stronger, although, except against the yen and Swiss franc – major haven currencies, there was nothing terribly unusual in the uptick. The greenback was up versus the yen by 1.35% and versus the franc by 1.20%.