MUST READ....especially the last paragraph...Gold did a stunning turn around yesterday....
Friday trading had another dynamic worthy of mention. On the release of higher-than-expected May CPI, the dollar quickly rallied, as bond yields jumped higher. Gold initially responded as it typically would in such circumstances, trending lower. But then, as bank and financial shares came under heavy selling pressure (with bank CDS moving sharply higher), gold enjoyed a burst of strong buying – ending the session up almost $24. While the precious metals of late have been caught up in de-risking/deleveraging and speculator liquidations, Friday trading provided an inkling of how a crisis of confidence in financial assets – and finance more generally – could spur safe haven buying in stores of value tested over centuries.
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