Diamond News

Gold rose overnight in a range of $1296.05 - $1306.50, aided by the political turmoil in Italy and Spain. Italy’s 10-year yield spiked to from 2.33% to 3.388%, and Spain’s 10-year yield jumped from 1.44% - 1.662%, while the safe haven 10-year German Bund yield sank from 0.46% to 0.192%, and the US 10-year yield tumbled from 2.93% to 2.799%.

The euro sank to $1.1510 – a 10-month low, driving the dollar to a fresh 6-month high (DX from 94.28 – 95.03).

Global equities were all significantly lower, with the NIKKEI off 0.6%, the SCI down 0.5%, Eurozone shares shed from 1.2% - 1.3%, and S&P futures were -0.7%. Weaker oil prices (WTI to $65.80, Russia and Saudis hint a possible exit from the supply cutting agreement) weighed on stocks.

Gold was lifted by the turmoil but checked by the dollar’s strength and some of the efforts to resuscitate the US-North Korean summit that was scuttled by Trump last week. It briefly penetrated resistance at $1305 (down trendline from 4/11 $1365 top) during European time, then just hovered below it ahead of the NY open.

Also, some dovish comments from the Fed’s Bullard (difficult for the Fed to raise rates when the BoJ and the ECB were pursuing accommodative policy) were gold supportive.
 
Just ahead of and through the NY open, the US 10-year bond yield rebounded to 2.88%, while S&P futures pared some losses (S&P -13 to 2704). The DX, which had pulled back to 94.70, jumped back to 94.90, and pressed gold lower.

The yellow metal fell through some stops under $1300 and its overnight low to reach $1293, where it found support ahead of the 5/24 low. An announcement that Vice Chairman Kim Young Chol was heading to NY...

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