This is the week I have said gold was ready to blast off. Today may or may not have been the lows but we should know more here very soon, probably within 24 hours. Interestingly enough the stock market had it’s worst day since May.
And the Fed thinks everything is just peachy. What could go wrong? Watch tech stocks to find out. They are do for a nice fall. Metals and miners should take off here soon. One more dip may be in the cards but I 100% lean bullish overall.
From the Trading Desk
Two weeks ago, gold failed to break above the $1,300 handle for the second time this year. It drifted lower and investors cut long positions as the FOMC approached last week. The FOMC raised the fed funds target rate to 1.00% – 1.25% and the commentary suggested that interest rates will normalize faster than financial markets expected. Gold traded lower in the wake of the FOMC and has trended down for the last four consecutive trading days. Support is coming in at the 200 day moving average of $1,238.50 and a seven point trendline at $1,240 dating back to September of last year. The SPDR gold ETF shed 400,000 toz last week, the largest redemption of a given week all year, and CFTC positioning showed a reduction of Comex gold length of 1.275 million ounces. With the hangover of the FOMC still fresh, stocks at all-time highs (again), and the USD trending higher, gold may find it difficult to mount a rally. Silver is trading well below its major moving averages and $16 is the next level to watch.
Doug Eberhardt is a 28 year financial services veteran and precious metals broker selling gold and silver at 1% over wholesale cost. Doug has written a book to help investors understand how gold and silver fit into a diversified portfolio, how to buy gold and silver, and what metals to buy. The book; “Buy Gold and Silver Safely” is available by clicking here Contact phone number for Buy Gold and Silver Safely is 888-604-6534
Commodity Futures Trading Commission Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don’t trade with capital you can’t afford to lose. This is neither a solicitation nor an offer to Purchase/Sell futures or options. No representation is being made that any account will or is likely to achieve gains or losses similar to those discussed in this outlook. The past track record of any trading system or methodology is not necessarily indicative of future results.
All trades, patterns, charts, systems, etc. discussed in this outlook and the product materials are for illustrative purposes only and not to be construed as specific advisory recommendations. All ideas and material presented are entirely those of the author.