Gold in consolidation phase; Gold ETF holdings steady
NEW YORK (Scrap Register): Gold could be in for a period of sideways consolidation, and exchange-traded-fund holdings held up despite a recent price decline in the precious metal, said Alex Thorndike, senior precious-metals trader with MKS (Switzerland) S.A.
While spot metal touched a fresh 2018 low of $1,282.20 on Monday, the market has mostly sideways since falling below $1,300 support on May 15.
For now we see stubborn resistance at $1,298-$1,300, with thick offers from producers, real money and leveraged sellers alike prevalent on runs higher, Thorndike added.
To the downside, support sits at the previous low and 61.8% Fibonacci retracement levels between $1,282-86. We think the gold will be in for a period of consolidation in the short term and are monitoring moves in ETF holdings, which have surprisingly held rather steadily given the move through $1,300 support, Thorndike noted.
He pointed out that holdings in SPDR Gold Shares, the world’s largest gold ETF, have only shed around 4.13 tonnes, or 133,000 ounces, since the price collapse on May 15.