Gold

With precious metals markets closed in New York today in honor of Martin Luther King, Jr., movement in gold was limited.

In overseas markets, gold was down $3.10, a number that would have been larger if not for some U.S. dollar weakness.

Gold continued its rise today, touching 1283 before backing down to a less-heated 1276. Upside was only limited today by the weakness of the euro in the face of a strong dollar. There was also some automated selling once gold hit its high.

Spot gold is now at its highest since September 2, of 2014.

Today will always be known as the day of the “Swiss Surprise.” The Swiss tore the cap off their franc’s valuation in a stunning move that has had traders all around the world scrambling to dump short positions they held in the currency. Some of them fled to gold, fueling a surge there of 2.4%.

Gold found some upside impetus early in the day before falling. It bounced up to 1245 before settling down for a small loss during afternoon trading. Silver prices were hit by a round of profit-taking only a day after gold experienced the same impulse. The gray metal is off over 1%.

Gold rode all the way up to $1245 today before profit taking began with a vengeance, driving it modestly down for the day. The dollar, continuing its mad rise, is accounting for all the negativity in the gold price.

West Texas Intermediate crude oil fell below $46 per barrel today and it scared the pants off equities traders, who now see the plummeting price as a barrier to profits in the sector. Energy stocks account for about 13% of the old-line stock exchanges.

Although in late afternoon gold is off its highs for the day, the yellow precious metal is up nearly 1%. Today, there was no headwind from the dollar; in fact, a lower dollar helped gold gain and keep traction.

The precious metals digested the news gleaned from the FOMC’s minutes and, for most of the morning and into early afternoon, the metals took heart.

Imagine a game of tug of war but with four opposing forces, four ropes and an indecisive referee. That sums up what we experienced today.

The precipitous drop in crude is being factored into the equities markets this afternoon, as we can see after prices in New York bounced off the day’s low. This has profound implications for the bull market we’ve experienced recently. Once the jitters are gone over oil, a more bullish attitude will prevail – for a while, anyway.