Silver volatility shoots up
Gold topped $2,450 overnight to hit a fresh record intra-day high. The move follows on from last week’s gains which were marked by a series of higher highs and higher lows. Five weeks ago, gold shot higher in thin Asian Pacific trade to hit a then-record of $2,430. But this proved unsustainable and prices fell back quickly and then took several weeks to find a bottom. The rally since then appears more robust, as each day of gains has been followed by some corrective selling. Silver also shot higher overnight. This followed Friday’s rally which saw silver surge above $30 per ounce, a level which had acted as resistance on several notable occasions. Silver has made incredible gains over the past fortnight, and it was looking overbought at this morning’s highs. We then saw a huge downward swing which took silver prices into negative territory in early afternoon trade. Since then, prices have steadied and indeed recovered, although they remain well below the highs hit overnight. Profit taking by the bulls is understandable given the size of the overnight rally and the pick-up in volatility. But traders would have to be very brave or foolhardy to go outright short on markets behaving this way.
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