Gold and silver prices are down in early trading, with gold off $14.20 to $1,698.80 and silver down $0.49 to $33.79, leaving the silver/gold ratio near where it was Friday at 50.3.
Commodities are down early on news that hedge fund managers have reversed earlier bullish bets in commodities, but I’m skeptical of that report. The pricing so far today looks more like a currency correction as the dollar gains ground against the euro, with the possible exception of copper. The Chinese cut their growth target for manufacturing and, since China uses 40 percent of the world’s copper, laying off seems like a good play.
Monday is rarely a good day to try and call the week ahead. There’s so much manipulation in markets by big players it’s hard to say if a dip is real or just someone trying to set up their options. I’ve learned to be wary of Monday morning price dips.
Overall the economic news is brighter but it’s still too early to be popping the champagne. At best this is an uneven recovery with one slim segment of the economy benefiting more than the whole. Without a sustained growth in consumer wages and buying power it’s hard to see where sustainable demand is going to come from in the market.