gold

Gold was finally able to close above its 200 day moving average yesterday, driven by continuous Asian demand, technical induced buying and last but not least funds. 1900/2200 bull spreads with August 2012 expiry were bought agressively on Comex. Global Gold ETF holdings saw a sharp increase of 11.1 tons or 357'000 ounces, which were mainly due to an increase of 10.6 tons or 340'000 ounces on ZKB funds. Given the fact that as per 3rd January report ZKB had dropped almost the same amount in holdings, it might be related to some year end repositioning. Some ETF demand on our own funds was noted yesterday, however nothing of large. Chinese car sales slowed in 2011 and were up 5.2% year on year, after gaining 33% in 2010, due to the fact that tax incentives and subsidies had been cancelled in 2011. Platinum continued its strong performance, taking out trend line resistance and climbing above 1500 early this morning. Unease might start to spread among short holders, who are running huge positions on Comex. Today's attention might be on the Italian bond auction followed by the ECB meeting.