A Pre-Fourth Of July Parade Of Factors in Gold, Currencies, Stocks And Oil | The Gold Forecast

A Pre-Fourth Of July Parade Of Factors in Gold, Currencies, Stocks And Oil

July 2, 2015 - 4:18pm

 by Gary Wagner

Gary S. Wagner - Executive Producer

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Gold Forecast: Proper Action

We entered long @ 1178.50, on Monday. Our stop @ 1161 was hit (-$17.50 on the trade)

We also issued a buy signal this morning (Thursday) after the previous stop was hit (today's video will detail the rational behind this call)

Maintain long gold @ 1164, Maintain stop below 1155 (today's low)

Gold Market Forecast

Although we saw gold trade under dramatic pressure today (trading to an intraday low of 1155.80), that low was to be short-lived as traders propped gold prices back up well off of these lows to effectively close in New York at almost an unchanged level on the day. Whether it was short covering or a buy-the-dip mentality the daily candlestick we identified was a “hammer." The significance of this candle type is that it demonstrated how quickly and severely the market recoups from these lows closing near the opening range of that trading session.

Based upon candlestick identification, our Elliott wave count, and channel analysis we determined that the intraday low at 1155 significantly formed a bottom in the market and that we should see prices move higher from there. With the referendum vote occurring on Sunday in Greece we could certainly see some safe haven buying return to the precious metals markets. All in all I do expect to see fireworks this weekend.

Trending Markets: Proper Action

Last week (Tuesday) we sent out a special trade alert recommending initiating short positions in the euro. The euro was trading approximately at 111.75 at the time of the sell.

Maintain current short euro @111.65. Maintain Stop @ 112.20

For those that are long U.S. dollars we recommend maintaining current long position and maintain stop @ approximately 95.11

Trending Markets Forecast

We have seen significant pressure and lower pricing in the euro, and the reciprocal upside moves in the US dollar for the better part of this week. Today we saw that current and strong trend soften just a bit with a firmer euro and slightly weaker dollar.  Today’s modest downside move in the dollar can be directly attributable to a mixed but lower than expected jobs report, which could signal a postponement by the Federal Reserve to initiate rate hikes in September or December of this year.

The corresponding moderate upside move in the euro could be attributed to the belief that a resolution to the current Greek debt crisis is at hand, as a referendum vote on Sunday could clearly signal whether Greece remains part of the euro monetary system. However, as I’ve spoken about on many occasions, austerity measures without a real detailed plan to boost the Greek economy can only put off the inevitable, which is the total collapse of the economic system in Greece.

This is the real issue at hand. Whatever the outcome of Sunday’s vote, it is the economic contraction in Greece that needs to be mitigated in tandem with solving their debt problem.

Sentiment Indicator: