Consolidation may preface the next up move. Gold was off in the far East, but picked up in London trading and continued higher until the noon hour of the New York session on Monday, after which it pulled back from $930 to finish another lackluster day at $924.70/oz., down $1.20. Overnight, gold has been pushing higher.

Platinum plunged in early Hong Kong trading and, although it was mostly up from there, it failed to escape the red, ending at $1973/oz., down $35. Overnight, platinum is sharply higher.

Silver pretty much mirrored gold, bouncing off a $17.30 low to regain positive territory around noon, only to give it back in the afternoon as it closed at $17.71, down 3 cents. Overnight, silver is trending higher.
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A second lackluster day in a row had to be a very disappointing one for gold bulls, especially given that the usual suspects—a dollar that weakened through the session, and rising oil—had both lined up in the metal’s favor.

The Hightower Report pretty well nailed the day’s action, writing that: “The gold market waffled around both sides of unchanged on Monday, with the initial scheduled reports prompting a decline in gold prices in the wake of a fleeting bounce in the Dollar. However, the gold market quickly shrugged off the post report reaction in the Dollar and instead seemed to gain favor in the wake of a recovery in oil prices. In fact, the action Monday highlighted the gold market’s recent tight correlation with the energy complex. In the end, seeing a slightly weaker US Dollar and a better than expected US retail sales report was the ‘best of two world’s’ for the gold bulls.”

But there are signs that gold may be preparing for an up move.

“Gold is forming a nice base here,” said Walter Otstott, of Dallas Commodity Co. “The dollar fell apart, and gold is coming back.”

The G7 meeting, held in Washington over the weekend, also factored in.

“Gold is stronger as the dollar has weakened, despite leaders of the G7 and IMF governing council saying they would do all in their powers to provide market stability,” wrote Mark O’Byrne, of Gold and Silver Investments Ltd.

“Continuing worries about the health of the international financial sector has led to declines in stock markets internationally and renewed risk aversion,” which will likely lead to a flight to quality, O’Byrne added.

Short term, “gold seems set to spend more time consolidating in its current range as cash generating liquidation caps the metal, while strong support is found back towards $900 an ounce,” wrote James Moore, of TheBullionDesk.com.