Gold

In a short trading day, a stronger dollar and regular trading tussled for dominance, with the traders coming out on top by $2.90 to the upside. Today is Presidents Day in the United States so the trading of precious metals was restricted to the morning.

Gold is about midway between its high and low for the day as we move into late afternoon. In regular trading, it found strength, but a U.S. dollar that started out lower early in the day has gradually moved almost to practically unchanged, eroding that extra oomph a soft dollar gives bullish movement.

Playing off a supposed agreement between Russia and Ukraine, brokered by western powers like France and Germany, equities markets relaxed a bit and were bid up across the world. Not all is rosy, however, in eastern Europe.

“I have no illusions; we have no illusions,” German Chancellor Angela Merkel said after the marathon talks. “Much, much work is still necessary.”

Today’s market can be characterized as cautious, rather than fearful. Money went to the sidelines ahead of a meeting by European finance ministers to discuss the future of Greece, and in all likelihood devise a plan to keep the struggling country with no visible means of support from exiting the euro-zone.

The U.S. dollar edged higher and that helped knock gold down a bit, although moves in the currency and the commodity were modest. The buck moved up on a couple of news items.

Some haven demand today pushed gold higher along with a quietly softer U.S. dollar. In Europe, Ukraine and the terrorists in Iraq and Syria weighed a bit on equities sentiment. We wouldn’t call it a tidal wave but there are some concerns about the world economy, with China leading the worry party.

The U.S. labor market looked provocatively robust today. Indeed, the unemployment rate ticked up 1 tenth of a point to 5.7% but that was largely because more people are re-entering the job market. The labor force actually expanded by 703,000 persons in January, a whopping huge number. The 257,000 new positions created last month couldn’t counter that.

As the dollar and the euro continue to engage in a high-spirited dance, today saw the greenback fall dramatically. This was an indication that the Greek financial predicament “feels” solved. The euro’s rise was also indicative of newfound strength in Germany’s industrial sector. The weighted measure of Germany’ growth in that sector leaped to its highest since 2008.

There’s nothing like scads of excess supply to drive down the price of a commodity. That’s what happened today when it was revealed that there were record stockpiles of crude oil. Consequently, West Texas Intermediate fell around 8%, Brent was down 5.5%, and wagging its tail behind them, natural gas was off by 3.4%. But, wait a minute before you think of buying a gas-guzzler.

While we live in the Age of Anxiety, the Age of Irony, and the Age of Social Media, we also live right now in the Age of Volatility. The markets proved it again today.

The Dow and the S&P 500 bounced up in a lively manner, the former adding 1.6%, the latter, 1.25%. NASDAQ fared only marginally less well. All European exchanges were up and in Asia, only the Nikkei was down.