Tanking Of Oil And Equities Pushes Gold Back Up | The Gold Forecast

Tanking Of Oil And Equities Pushes Gold Back Up

February 23, 2016 - 4:34pm

 by Gary Wagner

Gary S. Wagner - Executive Producer

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Gold Forecast: Proper Action

This is the trade alert sent out last night:

On Sunday (USA) we raised the stop on our long gold to below 1210, effectively closing the trade with zero profits or losses. In hindsight, we tightened the stop too quickly. Gold prices are once again strong and just beginning to trade in London.

Therefore I am recommending that you initiate long position gold which is currently trading between 1217 and 1218 with stops below 1200

Maintain your current long position at 1217

Maintain your current stop below 1200

Gold Market Forecast

Inasmuch as we saw weakness enter the market yesterday taking gold prices to an intraday low just above $1200 per ounce, after the dust settled the precious yellow metal was able to find support at roughly 1210 to 1214.

We currently have an upside objective and target for gold prices initially at 1250, and gold could trade his high as 1280 over the next month.

Trending Markets: Proper Action

Yesterday we sent out a trade alert recommending the initiation of long positions in the Standard & Poor's 500 vis-à-vis the E-mini.

Maintain your current long position at 1938.

Maintain your current stop below today's low at 1906.

Trending Markets Forecast

Once again we are seeing US equities extremely (and I believe overly) sensitive to price swings in crude oil. Granted the Standard & Poor's 500 index is heavily weighted with large oil companies.

However, it must be recognized at the same time that a multitude of corporations have seen their profits soar due to a dramatically lower price of crude oil.

Take the airlines, for example. They are experiencing nothing short of a windfall by maintaining their fare pricing, which includes the pre-existing premium for the formerly much higher price of jet fuel.

As we spoke about in our opening letter, at some point the US equities markets must disconnect their current pricing from the traumatic swings of crude oil.

Sentiment Indicator: