With the global economy on the mend, could gold be gearing up for another record-setting run? It sure looks that way. 

From the close of trading in New York on Wednesday afternoon at 5:15 Eastern Time…and the close of trading 24 hours later on Thursday at the same time…the U.S. dollar lost about 90 basis points. That’s a big drop. Gold’s response? Up three bucks…and silver was actually down on the day.

The high in gold on Wednesday turned out to be the Tuesday closing price of $924.10…as gold was under pressure right from the open in early Thursday morning trading in the Far East…as the New York bullion banks get about an hour head start before Sydney opens for business. This happened because the N.Y. bullion banks close for business at the end of one trading day…and open for business 45 minutes later for early morning trading in the Far East in the next calendar day. That 45 minute gap is the only time during the day that gold is not traded anywhere in the world. Note that on the Kitco gold chart below.

Gold firmed today, Thursday, as weakness in the dollar prompted interest in the precious metal as a currency hedge, with some physical demand after the previous session’s fall also supported prices.

Gold didn’t do a lot in Far East trading on Tuesday. The low of the day occurred at the open in London…and for the next two hours, gold put on a spirited rally [$10+] that ended with the price going vertical about half an hour before the Comex open. However, as is always the case at moments like these, the usual not-for-profit sellers showed up and did their dirty until it was time for them to go for lunch at 12:00 noon in New York. Once ‘da boyz’ were at lunch, gold made a $7 run higher, which ended the second that floor trading was over on the Comex…and electronic trading began.

From the first paragraph of my Saturday commentary…”I don’t know what it is about that [one hour and change] stretch of time between the Sydney close and the London open…but if there is going to be a down day…it starts right there a large percentage of the time.” Any questions? Actually, both gold and silver got sold off the moment that the New York bullion banks opened for business 6:00 p.m. on Sunday night…which is very early Monday morning in Far East trading. Shortly before 3:00 p.m. in Hong Kong, gold had almost made it back to unchanged…and silver was actually up a couple of cents when the hammer fell. The bottom for gold came very shortly after the London…

Gold managed to add about three bucks to its price from the beginning of Wednesday morning trading in the Far East…right up until 1:00 p.m. in the London afternoon…which was 8:00 a.m. in New York. At that point, gold tacked on $8 in less than 30 minutes…sat there until lunchtime…then tacked on another $8 in less than 15 minutes. Then one of the usual not-for-profit sellers showed up and that was it for the day. Gold did manage to poke its nose above $940 again…and finally closed above the $940 mark at $940.30.

Gold gained about $8 in the first eight hour of trading in the Far East yesterday morning. The top came shortly after 3:00 p.m. in Hong Kong…and between that time, and the Comex open, gold gave half of that gain back. Then we were treated to that [by now] familiar chart pattern…with the worst damage occurring once the London p.m. gold fix was in at 10:00 a.m. New York time. Between its high in Hong Kong and its low in New York…gold got hit for around $23.

Gold price action on Monday looked similar to Friday’s. The bottom for gold in the Far East came shortly after 3:00 p.m. in Hong Kong…rose until shortly after London opened, declined a couple of bucks…but once the London a.m. gold fix was in [10:30 a.m. in London...5:30 a.m. in New York], gold rose to its high of the day shortly after 11:00 a.m. This high [once again over $940] lasted until 9:00 a.m. in New York, shortly after the Comex opened…then it got taken down eight bucks to its low of the day at 10:00 a.m. in New York…which just happens to be the London p.m. fix…3:00 p.m. over there.

Gold had a very inconclusive day on Monday, rising from the far East to a peak of $942 in early New York trading, then plunging back to $934 at mid-morning, before moving in fits and starts through the rest of the day, to finish at $937.30/oz., down $1.70. Overnight, gold is trending higher.