Archived IMT (2010.08.12)

GOLD RALLIES after EUR sell-off intensified in early European trade following concerns with Irish debt and talk that Spain would not may not implement full austerity package. Gold was muted at the early stages of yesterdays USD rally before gaining $15 ounces. Gold remains propped by any sign of recurring worries on Eurozone debt, therefore, any fresh selling wave in EUR will provide fresh momentum. The best scenario for gold would be market expectations of QE by BOTH the Fed and the ECB. We already know Fed will buy treasuries torpevent balance sheet from contracting. Any signs that ECB has returned to buying Ezone bonds, will be especially positive for Gold. XAUUSD looks to close above the 55-day MA for 1st time since July 2. Daily stochastics may seem a little overbought but the WEEKLY oscillators suggest fresh upside towards $1,2470.