The release of US NFP last Fri triggered a wave of optimism and risk short covering. Gold was the first market to respond but yesterday it was sold aggressively and most of the gains extinguished. Concurrent events suggest a classic buy the rumour sell the fact pattern around hopes of a fresh round of US QE. Mr Bernanke has not changed the game and so recent trends remain in play, the euro in particular is still under pressure although now extreme momentum and sentiment signals have been unwound.
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Barclays Capital