Is Russia Cashing In On Its US Treasury Holdings?

Could Russia be cashing out on its U.S. Treasury holdings? Concerns over rising political tensions between the Russia and the West over the Ukrainian crisis have helped boost gold prices to their highest level in six months, as investors rush for cover into the traditional safe-haven asset. 
U.S. Treasury securities held in for foreign official and international accounts slid $105 billion in the week ending March 12, according to a Wall Street Journal report. The decline was the largest retreat on record. As of December 31, both official and private Russian holdings totaled $138.6 billion of Treasury debt, the report said.

Some market watchers wonder if Russia is moving funds out of U.S. Treasury bond holdings into other accounts that it would be able to access in case economic sanctions are imposed over the current Ukrainian crisis. Moving a billion dollars is serious business, and this situation remains on edge. All eyes will be focused on the Crimean referendum on Sunday as citizens there vote on potential secession from the Ukraine in order to join Russia.
What does this show about gold? Gold is still reacting in its traditional safe-haven manner. Investor flows are returning to the gold market. Bullish sentiment is climbing. The yellow metal has posted a stunning and some would say surprising rally move since the start of 2014. There are many potential factors supporting the up move, including a spate of weaker-than-expected data in the U.S. throughout the first quarter, weakness in the U.S. dollar index and most recently safe-haven buying from the Ukrainian crisis.
But, trend following traders often don't bother looking at the fundamentals. And, for now as the old market adage goes: "the trend is your friend." Gold is trading above its 200-day moving average, now at $1,304 basis the Comex April gold futures contract, which is a bullish signal to the trend following crowd.
Meanwhile, the U.S. dollar index has been trending lower in recent weeks as the bull market in the dollar has yet to materialize.
While tensions are heating up on the international stage, gold is reacting in its traditional and long-revered safe haven status. The near and medium term trends are bullish for gold, April futures have taken out a key resistance point at the October 2013 ($1,361) highs in recent days
and the bulls are focusing on a retest of the August 2013 high at $1,430.20.
Last year's gold declines are in the rear view mirror and gold bulls are back in charge.
Kira Brecht is managing editor at TraderPlanet.