OUTSIDE MARKET DEVELOPMENTS:

 Most of the financial markets are running steady to slightly counter to how they performed last week, nothing remarkable. Asian equity markets were mixed to a little easier overnight, and Europe was slightly weaker. The US stock market looks as if it will open slightly weaker as well this morning. Crude and gasoline prices are easier. Bond prices are higher in Europe and the US, and the dollar is up slightly. North Korea announced plans to launch a satellite next month, a move which has been condemned by the UN and the US and has even drawn comment from China. A launch could threaten the US food aid package. Traders will be looking at the NAHP Housing Market Index at 9:00AM central today. Other housing related data scheduled for later this week include Housing Starts tomorrow and Existing Home Sales on Wednesday.
There are estimates that central banks bought anywhere from 4 to 6 tonnes of gold bullion on the recent break. Traders are still expressing concern that India's pending increase in gold import duties will hurt physical demand for gold. The trend higher in crude oil and gasoline prices are putting a damper on the recent optimism about the US economy and the stock market's buoyancy of late. It seems that Europe's debt situation is creeping back into the limelight, with renewed concerns that Portugal will become the new Greece. North Korea's announced rocket launch has is also raising geopolitical concerns. Nothing dramatic or critical has occurred in the geopolitical sphere over the weekend, but the tone seems to be a little guarded at the beginning of the week, which could provide an underpin to the gold market following the sharp sell-off last week. Gold could feel pressure if this morning's housing data comes in strong. The Commitments of Traders Futures and Options report as of March 13th showed non-commercial traders were net sellers of 8,748 contracts last week, bringing their net long position to 163,276. Non-commercial and nonreportable traders combined held a net long position of 206,733 contracts, a decrease of 4,558 contracts. Comex Gold Stocks were 11.411 million ounces up 9,704. April gold is still consolidating around last week's lows, which usually means continuation, so we would not be surprised to see the market attempt one more move to the downside. However, the bears might be reluctant to push too far given the strong underpin to crude oil and the renewed concerns over North Korea. Look for trendline support at $1,640.2, then a retracement target of $1,628.5. Initial resistance could come in at $1,670.5.