Gold Gives Back Gains Achieved Tuesday and Wednesday

March 14, 2019 - 5:26pm

 by Gary Wagner

Except for palladium, all the major precious metals sustained strong declines today of 1% or greater. As of 3:30 PM Eastern standard time the largest decline was seen in platinum futures which gave up 1.94%, and after a $16.20 loss is currently fixed at $825.50. Silver was close behind giving up 1.75% on the day, and after a $.27 drawdown is currently fixed at $15.185.

Gold gave back almost all the gains realized on Tuesday and Wednesday as it lost just over a full percent (-1.02%). The most active April Comex contract is currently fixed at $1295.90 with a drawdown of $13.40. The next front running month in gold futures is the June contract which is currently down $13.60, however still trading above $1300 at $1302.20

Lastly, the only precious metal to buck the trend today was palladium, its most active futures contract gained .52% and after factoring in today’s gain of $7.80 is currently fixed at $1514.50.

Although dollar strength contributed headwinds across the board in the precious metals, the majority of drawdowns are directly attributable to traders bidding  three of the four precious metals lower.

Spot gold gave up $13.40 today and is currently fixed at $1295.50. According to the KGX (Kitco gold index), dollar strength only accounted for $3.70 of today’s decline, with the remaining $9.70 of losses directly attributable to selling pressure.

Currently the U.S. dollar has regained some of its losses sustained earlier this week. Currently the index is up by just over a quarter percent and fixed at 96.76.

One of the major factors contributing to recent activity and extreme volatility in the precious metals is the Brexit dilemma and ongoing votes, which up till now resulted in a stalemate lacking any real progress to resolve their current dilemma. There is also the factor of recent volatility seen in the British pound and Euro dollar, a direct result of Brexit issues.

Although gold prices did break below their 50-day moving average, after breaking above this key short-term indicator yesterday, on a technical basis today’s decline did not create any major chart damage.

On a technical basis we currently show resistance at $1313 per ounce, which the .23% Fibonacci retracement. Support for gold is currently at $1291.60 for the most active April futures contract. These support and resistance levels are from a data set that begins at $1195 up until $1350, which is currently the highest trading price of the year.

Wishing you as always, good trading,

Gary S. Wagner - Executive Producer

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Gold Forecast: Proper Action

Friday morning, March 8th, we issued a trade alert to buy June 2019 gold (GC M19)

Maintain long gold at 1305

Maintain Stop at 1287.13

Gold Market Forecast

Although gold lost significant ground today, on today’s report we will define why we believe that the decline did not cause any major chart damage. We still are looking for gold to trade higher in the week ahead.

Sentiment Indicator:
Gold -> Bullish
Silver -> Bullish
S&P 500 -> Neutral
Bitcoin -> Bearish