Unexceptional volume overnight concealed that the selling momentum that rolled in yesterday after gold spiked to a new contract high was unable to achieve a meaningful retreat to the low $1420s...close but prodigal and our ever-ardent buyers were quick to saddle up. The facts remain salutary...GSR slightly elevated at ~39.40 continues to reflect congenial liquidity notwithstanding the continuing provocation of physical silver shortages. Gold open interest as of Friday rose slightly to ~518,000 contracts on a day with concussive confrontation and suggesting that the close to $20 buck lift from lows to high during that day were short covering as opposed to new money. RSI at ~67.00 is constructive within its recent pattern. Gold option vols remain very cheap historically and with April expiration within weeks activity is moving to the June strikes. Today: last night's impressive regrouping of buyers at the lows should allow us to revisit the mid-$1140s... a perfect day for the doubters to confront the believers.
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