After a wild last week for basically every market except the precious metals, the climate has calmed down substantially this week so far.  The Vix volatility index has halved since it traded over 31 last Wednesday.  Equities have found their footing and the Dow is on track for its third day of consecutive gains after forming a base at 16,000.  There is an overall risk-on sentiment and gold continues to press higher, even bucking its normal inverse correlation to stocks and the USD.  Gold has moved upwards through its 50 day moving average at $1,248.50 and the former double top at $1,250.  Since the yellow metal has moved up $75 in the last two weeks, it would not be a surprise to see some profit taking though.  Near term resistance is coming in at the 100 day moving average of $1,274.50 while $1,233 is current support.  Silver is pressing against the higher end of its recent range and $18 is still the near term objective.

With gold in a lower trading range over the last two months, physical demand has picked up substantially.  Swiss trade data released today showed September gold exports reaching 172.60 tons (5,549,090 ounces), the highest monthly outflow since February.  Gold heading to China in September jumped to 12 tons which was four times the average of the previous four months.   Indian exports were 58.5 tons which was the largest shipment year to date and twice the average monthly volume.  Also, Russia purchased 37.33 tons of gold in September, its seventh month in a row of increasing its gold reserves.

Keep an eye out for US Core CPI m/m tomorrow and US Unemployment Claims out on Thursday.