(OroyFinanzas.com) – Gold was little active overnight, hovering on both sides of the $662 level. In Europe, spot climbed higher. The high of $665.10 was eventually reached but technical selling did not let the metal to sustain that level and prices eased to fix at $663.50.
Spot rebounded back prior to the opening of the Comex division of the New York Mercantile Exchange but that was short lived. Subsequently the yellow metal started its long descent. Some negative news were not supportive for gold. Indeed, accordingto the European Central Bank, gold and gold receivables held by euro-zone central banks fell by 280 million euros to 180.215 billion euros in the week ending May 18. This fall is due to sales by three Eurosystem central banks. Moreover, Brent crude eased towards $70 a barrel after hitting a 9-month high yesterday, while remaining firm on continuing supply outages in Nigeria and on the OPEC decision to not pump more crude to help ease prices and replenish fuel stocks. The yellow metal fell sharply after therelease of the Richmond Fed Survey at -10 in May versus -11 in April.
Negative figures suggest a contraction in the activity in the ‘fifthdistrict’ (Columbia, Maryland, Virginia, North Carolina, South Carolina and most of West Virginia) producing approximately 9 percent of the nation’s gross domestic product. Brent Crude further fell as oil markets anticipated a fresh domestic inventory snapshot expected to show gasoline supplies roselast week. Gold dipped below the $660 support shortly before the settlement and closed on the downside of the intraday range. We believe that gold is still looking for consolidation.
Silver followed exactly the same pattern as gold. The metal was rather quiet in the Far East. After the opening of London prices rallied upand hit a peak of $13.11. Then selling forced prices below $13. Silver kept losing ground through the entire Comex session and tested once the $12.90 resistance. Speculative buying on the lows however propelled it slightly higher. We think that it is essential for silver to regain and sustain the$13 level in order to head higher.
MKS Gold & Silver, Daily Report
By Moniah El Shikh
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