This Week in Gold and Oil Volatility

Gold prices continue to be range bound with GLD trading in a range for the week that was just over 2 points. Gold is one of the few markets I do not have a lot of history with, but this 2.00 point range looks very unusual to me. So it was time for me to run numbers. GLD traded in a 1.3% range the past two weeks. The average weekly range for GLD is 3.7% since inception is 2004. The minimum weekly range was 0.8%. So yes it can get worse (that is if you depend on gold volatility for trading). GVZ and GVZ futures are reflecting this lack of volatility with GVZ dropping 8.2% on the week and the futures following the index lower. March futures went out 1.27 higher than GVZ with two more days to trade. We’ll see on Wednesday if the futures or the index was closer to settlement this weekend.

OVX is dipping to historically low levels as well. The USO ETF did trade a little higher on the week, but nothing to justify a 10% drop in OVX. I’m starting to wonder if in this interconnected world low VIX is creeping into other markets. At minimum there may be some influence from VIX.