The U.S. Comex gold futures has declined 1.21% this week to $1,143.90 and has fallen 2.38% month-to-date. This week, the S&P 500 Index has risen 2.31% and the Euro Stoxx 50 Index has surged 4.21% while the crude oil futures have declined 3.47%.
Risk is still extremely high and I still believe there could be an event before the end of the year that torpedoes the market. For right now we are due to back and fill. Like March 2011, a decent move commenced but it lasted about 6 weeks. We are coming to the second half of July, its vacation time for the markets. Nothing too drastic should happen here as August is just about the slowest month of the year. But once September gets here my antenna will be out.
Greece reopened its banks and started the process of paying off billions of euros owed to international creditors on Monday in the first signs of a return to normal after a deal to agree a new package of bailout reforms.
The Greek parliament has approved the bailout package and the market has accepted it with a strong corrective rally in the equities indices after yesterday afternoon featured some protective selling near the close.
The U.S. Comex gold futures fell 0.48% last week and dropped a further 0.38% this week to $1,153.50 on Tuesday. The implied volatility of the gold futures has been falling from 21% in January to 11.5% currently in line with the decline in prices.