Alan Williamson Market Quotations

Unless something happens in the Middle East or the dollar has a significant move, then I suspect that the next few days we are just going to see the market drifting.

Certainly sentiment towards gold now remains positive, with the market ignoring the further drift lower in the oil price and the recent strength in the dollar,

Given the positive sentiment...it would hardly be surprising if the market does take heart from any dollar weakness even though it ignored the move higher.

Over recent months gold and equity prices have been positively correlated. This has particularly been the case in Japan, where investors have sought to lock in stock market gains by recycling funds into gold. With equity markets weakening, local investors sought to secure gains on gold and move into cash.

The activity in the bullion market remains very impressive, with aggressive buying of any dips and a dearth of selling in the rallies helping to create a bullish chart pattern of higher lows, and higher highs, thereby attracting more momentum-based fund buying.

The trade in the gold market is very, very thin, with gold off the lows and the highs of the day at $502/oz and $508/oz.

There is very little happening and we're seeing thin volumes today. The market lacks direction; it may continue trading sideways.

Once again the gold market has surprised by its resilience. Sentiment towards gold was helped by an early recovery in the base metals markets.

If the market can absorb such a weight of selling, then just imagine what will happen if the funds begin to reinstate long positions.

Geopolitical tensions have helped to support the price, but otherwise the market is lacking any external impetus.

The market continues to hold in the middle of the $535-$575 range that has held since early January, with the most recent price action suggesting a bias towards a move higher, rather than lower, within this trading band.

Although CFTC Commitments of Traders data showed a small fall in the total speculative long position, most holders seem to have been willing to stay with the market for the time being.