Gold Takes a Needed Consolidation and Correction After Respectable Gains | The Gold Forecast

Gold Takes a Needed Consolidation and Correction After Respectable Gains

June 10, 2019 - 6:43pm

 by Gary Wagner

Gary S. Wagner - Executive Producer

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Gold Forecast: Proper Action
 
We are currently flat after taking profits yesterday. On opening weaknees, when gold was down $8.00, we took our stop to the market.. Long @ $1293.10 Out @ $1338.10 =  $45.00 per ounce, or $4500 per contract.
 
Thursday morning, May 30, we sent out this message -Trade Alert: buy August 2019 gold @ the market. Respectable move today in gold which is currently trading up $6.80 to $7.00, basis the August 2019 contract and fixed at $1293.10.
Gold Market Forecast
We remain bullish for gold on a long-term basis, however Sundaywe got the short term pause in this rally we have been waiting for..  
 
Support for gold continues to be  attributed to statements by Federal Reserve Chairman Jerome Powell who alluded to the potential for rate reductions this year to continue the economic expansion. This coupled with last  Monday's statement by the president of the St. Louis Federal Reserve Bank, James Bullard is significant in that it illustrates real support for rate cuts if needed. Last weeks Labor department Jobs report came in well under exceptions. 175,000 new jobs were forecast and the actual number was only 75,000, are supportive of rate cuts.
Sentiment Indicator:
Gold -> Neutral
Silver -> Bearish
S&P 500 -> Neutral
Bitcoin -> Neutral
Bitcoin fundamentals by Joseph M. Wagner II:

Bitcoin prices have stabilized somewhat and art trading in a narrow range between $7500 and $8000. After two months of elevated trading volume in the CME, volume has dropped back down to normal levels seen over the last year excluding April and May.

The recent drop in trading volume is coupled with a gap down between Friday’s close in Monday’s open, this is the first occurrence of such a downside gap for over six weeks after it showed a gap down on May 6 which was preceded by another six weeks of upward gaps.

Although pricing opened below the .23% retracement of the most recent rally it is trading well above it at approximately $8000 on a technical basis the bulls nor the bears have complete control of the markets, although The bulls do have some technical indicators on their side with all major moving averages (50,100 and 200-day) well below current pricing in fact the 50-day MA is $1700 below current pricing. The 50 –day MA was acting as critical support from February 10th up until the huge upside spike that occurred on April 2nd.

Another note on moving averages is that the 100-day is approaching the 200-day which would form a golden cross and put all MA mentioned in true bullish formation meaning the longest or 200-day on bottom, the 50-day on top with the 100-day in between the two. A quick look at the RSI reveals it is still close to being over priced at 61 on the RSI.

With mixed technical indicators I would have to be neither bearish nor bullish on BTC futures for the time being. On a fundamental front although there is a positive note coming out of an announcement by Microsoft which states that they will be adding Blockchain tools to its power platform. This is not the first release by Microsoft of a block chain powered tool last May the company debuted Azure, a development kit for the Ethereum block chain. Also in May Microsoft announced onset of a decentralized identity network atop the Bitcoin Blockchain.

If we look back to May pricing in BTC we can see that pricing surged that month and big tech using, adopting and creating platforms that work off of block chain surely helped the rise in price in the month of May. Since this announcement earlier today BTC futures came well off of their lows although how much of a boost this will give BTC is still an unknown as it is more intertwined with ETH whose pricing rose today nearly twice as much as BTC.