No Luster Lost in Gold’s Shine | The Gold Forecast

No Luster Lost in Gold’s Shine

July 2, 2019 - 6:21pm

 by Gary Wagner

After selling off and gaping lower on the open in Australia forty-eight hours ago and trading to a low of $1385, gold quickly recovered with today’s dramatic gain of $27. As of 4:19 PM EDT, gold futures basis the most active August contract is currently fixed at $1417.10 which is a net gain of $27.80 on the day. This amounts to a 2% gain in gold pricing in a single day.

Apparently whatever bearish sentiment unfolded immediately following the G-20 meeting in Osaka, Japan last week quickly diminished as extremely bullish market sentiment returned. Without a question this one will certainly be remembered by gold traders and investors for some time to come. Not only did gold pricing quickly recover, it is now trading roughly 4 dollars above Friday’s closing price.

Today’s dramatic recovery is almost entirely based upon bullish market sentiment with only a fractional gain attributed to dollar weakness. This is definitely apparent in physical gold pricing today. According to the KGX (Kitco Gold Index) Spot gold as of 4:24 PM EDT is currently fixed at $1413.50, a net gain of $29.80 on the day. On closer inspection we can see that only $0.70 of today’s dramatic gain was attributed to a weakening U.S. dollar, with the remaining gains of $29.10 directly attributable to bullish market sentiment resulting in investors bidding the precious yellow metal higher.

Today’s dynamic gains are once again occurring in tandem with gains in U.S. equities. All three major indexes scored moderate gains in trading today with the Standard & Poor’s 500 gaining .29%, the Dow gaining .26% and the NASDAQ composite gaining .22%.

Typically, there is an inverse relationship between gold and equities. Equities are considered a risk-on asset, and gold solidly footed as a safe haven asset. By definition these two asset classes gain or lose value for completely different financial reasons. However, there are a few exceptions to this rule, with one being sensitivity to interest rates. Both asset groups will react favorably with a bullish demeanor based upon falling interest rates.

The outlook for weaker global growth is fueling the market sentiment which is reacting to the possibility that the Federal Reserve along with global central banks will still initiate rate cuts this year to continue the global economic expansion. Other analysts have cited a re-evaluation of this weekend’s one on one talks between Trump and Xi Jinping. Even with the trade war truce still in play, many analysts believe that the current trade war is still far from over. Although this weekend’s talks did not escalate the current dispute it did not resolve any of the long-term issues which have plagued the two superpowers from being able to negotiate an amicable resolution for both countries.

All things being equal gold pricing lost no luster long-term and has once again returned to its extremely bullish demeanor which has taken prices approximately 8% higher this year. In fact, gold which opened at roughly $1260 in January of this year is now solidly higher by approximately $161 giving us a net result of 8.8% yearly gains.

Wishing you as always, good trading,


Gary S. Wagner - Executive Producer

This report is now free and publicly available to everyone

Gold Forecast: Proper Action

In between the recording and production and release of today’s report we sent out a trade alert to buy August gold at the market. There is no doubt we had fast market conditions and gold was trading at $1427 to $1431 when the alert was sent out both email as well as text SMS message. In fact I was in such a rush to get the trade alert out that I followed the trade alert to place a market by order with a stop placement alert roughly 5 minutes afterwards.

Today’s video will not cover the fact that we entered the long position only the parameters I was looking for to enter the trade therefore

Maintain your long August gold at $1427 - $1430

Maintain your current stop at $1408.13

Gold Market Forecast

In the 35 years that I have been a commodity broker, commodity trade adviser, trading application software developer, and market analyst I have rarely seen the kind of key reversal we witnessed in gold in the last 18 hours. The market is currently fast and active and the trade alert that I sent out occurred in between the time that I recorded the show and released the show postproduction. This is an extremely rare occurrence all traders should be long August gold with an appropriate stop at 1408 13.

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