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Gold futures settled at a new record Friday, ending higher for a fourth straight week as the U.S. dollar fell against the euro to a fresh one-year low, boosting gold’s investment appeal.

The thinly traded September gold contract ended up $9.50, or 1%, at $1,004.90 an ounce on the Comex division of the New York Mercantile Exchange, the highest settlement for a nearby gold contract. The earlier record was $1,003.20 hit on March 18, 2008. The September contract rose to $1,011.90 earlier.

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Mark Hulbert has an interesting article in MarketWatch which notes that for the first time since 1958 the yield on the Standard & Poor’s 500 index (SPX) has risen above the interest rate on the CBOE 10-Year Treasury Yield Index (TNX). As of Tuesday’s close, the S&P’s dividend yield was 3.3%, while the 10-year T-Note was yielding 2.7% — a spread of 0.6 percentage points in favor of stocks.

EUR/USD – Rejected by Resistance
October 31, 2008 12:56:05

(Please click on the accompanying chart to enlarge. Chart is courtesy of FX Solutions.)

As of early Friday morning (10/31/2008) in New York, as shown on the accompanying EUR/USD daily chart, the upside correction on this key pair has been rejected at the key resistance imposed by a major 38.2% Fibonacci retracement level that coincides with strong prior support/resistance around the 1.3250-1.3300 region. After having been rejected at this level, price has fallen back severely once again to target strong support around the two-and-a-half year lows in the pair (1.2330 region), which were just hit earlier in the week. At this juncture, we should potentially be seeing a consolidation between the long-term lows and the aforementioned 38.2% Fibonacci level, possibly with some further near-term downside action within this consolidation.