Gold Intermarket: VIX at lowest levels for 24 years

Gold prices are continuing to stabilise, although the yellow metal remains fragile with a dip below the 1228 level today to 1226.08 the low. The high has been 1236.48.

That was a very modest rebound and the price has been unable to recover anything significant this month so far after the drop from $1,295 at the end of last month's business. Risk hs turned more positive and indeed the VIX is at its lowest levels for 24 years. The VIX (the market's fear gauge) touched a low of 9.72 intraday, marking its lowest level since 1993.  

Macron's victory on Sunday has helped to assuage the fear of the growth of populism in Europe and global markets. For now, the EU is out of the woods yet with respect to the project surviving for the rest of this year. 2018 may be another story again with a number of concerns in from the state of the Italian economy and banking sector throughout Europe. Indeed, the problems that the EU has come to the surface and into the public eye. 

However, the metric's historical average is 20. We are well below there today and have been so for quite some time, ever since President Donald Trump's Election Day victory back in November. Stocks have continued to climb higher/sideways and perhaps market participants that investors are becoming too complacent? 

However, for now, the trend is your friend is playing out and gold will continue to struggle in risk-on markets. Gold has resistance at 1236.00 & 1241.50  while a move below 1221.00 could open up 1216.00 and 1210.00 as key supports. Meanwhile, the RSI is mixed to bullish.

• WTI bulls testing the key 46 handle
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