Gold Settles $19.50 Higher… ($1220.30)

After the initial measures taken by the European Union agreeing to a Trillion Euro rescue package in attempt to combat soaring debt in the Euro region and to preserve the Euro it appears that investors have re-examined the bail-out package and determined it may be inflationary.

The Euphoric atmosphere yesterday rallied indices and was bearish for both the U.S Dollar and Gold as investors who were choosing gold as a flight to safety temporarily lost ground. However, on this day savvy investors were not completely convinced the Euro regions smaller countries' ability to cut their deficits.

Other investors were concerned that the European Union would be printing vast amounts of currency to inject into the Euro state's economy. The vast amount of currency needed raised flags of pending inflation. Inflation is "BULLISH" for gold and once again sent investors to a safer haven….GOLD.

The European Central bank was reported as buying up bonds from both Greece and Ireland today…   Meanwhile the continued EU uncertainty rallied Gold to new highs late in the Globex session as the global insatiable appetite for gold has been rekindled.

Yesterdays Gold sell-off gave the jewelers of India The opportunity to re-stock for the upcoming Hindu Holy Festival (AKSHAYA TRITIYA) falling on May 16th. This festival is a huge day for buying gold. In fact jewelers have been known to run out of gold….

*INDICATIONS are China's Central Bank is contemplating raising rates again

WHOLESALE INVENTORIES …up 0.4%

UNITED KINGDOM PRIME MINISTER BROWN RESIGNED…..

REPORTS 5/12…..

TRADE BALANCE………..7:30 am (CST)

MY SWING NUMBERS 5/12…JUNE GOLD

RESISTANCE # 1……………$1240.00

RESISTANCE # 2……………$1231.00

PIVOT…………………………..$1216.00

SUPPORT # 1………………..$1207.00

SUPPORT # 2………………..$1192.00

Mike Daly / Gold Specialist

PFG BEST

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312-563-8029

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