PRECIOUS METALS RECAP 4/23/2012

June Gold closed down 3.2 at 1639.6. This was 16 up from the low and 4.6 off the high.
May Silver finished down 1.12 at 30.531, 0.344 off the high and 0.081 up from the low.
The gold market forged another lower low/lower high print on the charts to start the new trading week. Clearly global macro economic confidence started the week under pressure and the bull camp in gold has to hope that the US Fed can effectively improve sentiment with their statements or actions on Wednesday afternoon. However, in the event that conditions in the Euro zone continue to foster anxiety, the overall outlook for the global economy might continue to deteriorate and the US Fed in a sense might be charged with countervailing a wave of fresh international negatives. While there might be some buyers interested in stepping in ahead of the Fed later this week, the near term direction of equities and currencies might leave the bear camp with ongoing confidence.

Clearly the silver market took the overnight deterioration in global macro economic conditions significantly harder than the gold market as the May silver contract at times today was as much as $1.19 below last Friday's US close. A deterioration in physical commodity demand views combined with negative Chinese silver import data for a patently negative short term view toward silver prices. It goes without saying that silver was also undermined in the wake of the hard down action in US equities and seeing adverse currency market action also seemed to be pushing some silver longs to the sidelines. Like gold, the shorts might not be inclined to cover their positions until the FOMC statement is closer at hand.