Gold bears may note that the price of the yellow metal is grinding toward 2013 lows without any real price support developing. However, the price action in the volatility market may signal more of a neutral than bearish outlook for gold. The SPDR Gold Shares ETF (GLD – 124.28) was down over 2% on the week. Option players seem unconcerned that a big move (higher or lower) is coming over the near term and the CBOE Gold ETF Volatility Index (GVZ – 19.37) was lower as well. The calm outlook that persists in the equity markets carries over to the gold market for the rest of 2013 as well.
Not to be outdone oil volatility dropped last week. The CBOE Crude Oil ETF Volatility Index (OVX – 19.70) dropped as the energy markets seem to be losing some geopolitical risk premium. The curve shifted lower on the near end, but was basically unchanged for early 2014.