Fear In Equities But Not In Metals

New York (May 30)  Yesterday was an interesting day for the metals. With panic around the world, gold and silver were flat. The fear in equities, bonds and the U.S. dollar didn’t spill over to the metals, which on the surface would be considered a strange occurrence if not a bearish sign.

Last week gold made a panic bottom and then rallied about $30 from that bottom. Gold is now consolidating and making higher lows. The pattern suggests that gold is building support as it prepares to make a run to the next resistance at $1,330.

Although many markets were driven by fear on Tuesday, the metals were not. Traders and investors must understand that correlations and fear don’t always move markets at the same time. Gold had already rallied big from the lows and was fairly priced, fear or no fear.

KitcoNews