Because there is a lot of confusion in the markets right now investors are wondering whether they should buy gold/silver now or wait? You can see the market turmoil in most every market and country, yet gold can’t get moving higher. This is about a negative of a indicator as I have seen for the safe haven metal. But it won’t last. We will more than likely break down before we move higher as that is what my analysis shows,
I had called the dead cat bounce we had pathetic. If we were to try and move higher, what will move the metals? The negative jobs report on Friday caused gold to immediately spike up and it was almost like we were in the old days of gold investing where data showed the way. But as soon as you got your trade long in gold, the market reversed and we hit a lower low? If you listened to CNBC the data spin was of course positive with the long term rate hitting a multi-year low of 5.2% and the last 2 reports being revised higher. But the short term data fell way short of expectations.
U-6 unemployment numbers are still double digits. That number is ignored by CNBC and the Fed overall though. So the question on everyone’s mind is will the Fed raise rates Sep. 17th or won’t they? I have said all year long they would to a token .25 raise in rates to save their credibility. They have to talk the talk and pretend that all is well but I have also shown that the data doesn’t back up all this confidence in the economy. When you look at the rest of the world, especially China having market turmoil and Europe fighting deflation, then add to that the U.S. problems of too strong a dollar, if the Fed raises rates it may not be a stock market mover or gold mover because everything is already priced in. But if the Fed did not raise rates, then stocks should fly up and gold should get a bounce too. I just don’t lean that way.
Should be a quiet week overall as we wait for the Sept. 16, 17 Fed meeting and Yellen’s speech shortly after.
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.