Gold Meanders Around Waiting For The Fed Next Week
(Kitco News)- Gold prices continue to meander in a tight range, with anysignificant break-out likely to await the Fed meeting next week. Yesterday'scomment from a member of the ECB that the conclusion of the QE program may beplausible by year-end provided some lift to the euroand modest buying in gold. It is unlikely gold will break through the recent$1,287 - $1,307 range until the Fed decisionis announced. Silver has been quietly strengthening relative gold, with theratio now approaching 78:1, from the 82:3 level seen early last week. Wecontinue to favor silver against gold and trading the ratio appears a less riskyapproach than an outright naked silver long. The charts on silver suggest goodsupport at $16.40 and a break above $16.67,on a close basis, suggests a retest of the $17 handle. Gold may weaken into themeeting but we believe the rate increase for June is a done deal. Theannouncement may still cause some knee-jerk selling, but may prove a good entrypoint.
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