Interesting way how UBS below describes the NY capping of gold at the $1240 level yesterday. The same strategy appears to be in place today in NY but their containment operations may fail abruptly should the euro fall much below the 1.25 level.

Regards - VHF

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UBS Metals Daily

Author: Edel Tully

May 14, 2010 3:59:36 AM

...Ascension Day closures across much of Europe ensured that demand for gold coins and small bars took a step back yesterday. It has picked up once again today, but is unlikely to replicate levels from the beginning of the week with Europe heading into a long weekend. While gold reached a high of $1243 in New York yesterday, the metal encountered not insignificant selling around $1240 from a range of investor types which gave it a heavy feel for much of the day. We understand that scrap supply has escalated this week, and in a pattern common in the physical gold market the West is buying while the East is selling.