Gold continues to be range bound despite global markets focusing on a new crisis in Europe. GLD traded in less than a two point range for the week after only managing to cover about a three point range the previous week. GVZ reacted in an unusual manner to the combination of low realized volatility and a new macro-economic risk coming out of the EU. GVZ climbed about 3% on the week which would have been head scratching if it were not for Cyprus. However, the April and May futures lost value. It appears that the gold volatility market may be expecting a quick resolution to the Cyprus situation.
Oil volatility was also higher despite USO trading up by 0.01 on the week. Again some of this may be attributed to a little higher global risk being priced into this market. Like the GVZ market, the front month April OVX futures lost value on the week despite a higher underlying index.