Gold is moderately up after a downward spike overnight in Asian trading. Silver and platinum showed similar behavior. Gold has moved above its 100 DMA of $1371, which opens up the possibility of more gains. Today is the fourth day of gains in five sessions for gold.
However, the spectre of the FOMC still hangs over global markets, making traders wary of committing to large positions. The minutes of the July FOMC meeting will be released tomorrow, and will be ravenously gleaned for any clue whether the Fed will be tapering its $85 billion a month in bond purchases in September.
The fear of this occurring is playing havok with the economies of emerging market countries like India and Brazil, where capital had moved in search of yields. Now that the US Treasuries and German bund yields are hitting two-year highs, the money is fleeing these nations and returning home, causing a monetary crisis. The 10-year Treasury yield has however backed down slightly from two-year highs this morning, to 2.82%. It's seeing demand as money seeks a safe haven.
That safe haven demand is bypassing the U.S. dollar, which is at a six-month low against the euro, and also lower versus the yen and Swiss franc. The yen, franc, and gold are the beneficiaries of this safe haven demand today. These currency developments are bullish for gold.
Of course, the continuing bloodshed in Egypt is also a factor in gold's recent rise, though perhaps not as much as some expected. Yet more fuel for gold is the news that the German finance minister has admitted that Greece is going to need yet another bailout, paid for by, among others, German citizens.