As of 5:07 PM EST gold futures basis the most active April contract is currently trading up $6.10 (+0.37%) and fixed at $1639.50. Although gold opened slightly above yesterday’s close, today’s close was below today’s opening price.

Consider this, gold has had a price range from Friday’s low ($1457) to Tuesday’s high (1698.60) of $241. If you compare Friday’s opening price ($1470) to Tuesday’s close ($1660) Gold had gained a total of $190 over three trading days. Based on the rapid ascent of gold pricing today’s moderate selloff, I believe that is healthy.

The rally which began in gold yesterday continues, now in its second day with substantial gains. After yesterday’s $60 advance which took gold pricing from $1507-$1567 ignited the second stage thrusters as it achieved terminal velocity and entered the stratosphere on its journey to the stars and even higher pricing.

Today gold pricing skyrocketed and broke strongly above Friday’s close. This incredibly strong move is based upon the release of a statement by the Federal Reserve at 8:00 AM EST, and the inability for the government to agree on a proper fiscal stimulus package.

Over the last couple of weeks, the safe haven assets particularly gold have been selling off as part of a mass liquidation of all asset groups following the U.S. equities reaction to the coronavirus pandemic and actions being taken worldwide. Historically speaking when you look at other crisis this one stands alone with some major distinctions.

Gold continues to fall in the presence of extreme dollar strength which is dictating most of the net change within the precious metals complex. As of 6:15 PM EST the dollar is currently up almost 2%, with the index currently fixed at 103.56.

When we look at the precious metals complex the only thing we see moving higher is not a specific precious metal, rather it is a ratio between two precious metals. This ratio is the only investment that is competing with recent dollar strength which hit a new high today of 101.26, after factoring in today’s gain of approximately 1 ½%.

Yesterday U.S. equities had their deepest and most brutal decline since black Monday which occurred on October 19, 1987. At the same time gold opened higher in Australia, and then began to selloff as it traded in New York. It traded to a low of approximately $1450 before recovering back above $1500. The one constant that we have seen rise is the volatility index for both gold and U.S.

Today the financial markets with the exception of bonds plunged. The Dow Jones industrial average lost almost 3000 points in trading. Analysts are citing the global COVID–19 (coronavirus) as the primary trigger for this selloff.

It was a combination of an exceedingly strong recovery in U.S. equities and the dollar index gaining over a full percent that put enormous selling pressure in the precious metals complex across-the-board. Yesterday the Dow had its largest one-day decline since the 2008 financial crisis.