Video-September-09-2013-Archives-Daily-Show
Video section is only available for
PREMIUM MEMBERS
Essentially Unchanged
A number of low impact issues entered the market, causing gold to waver before falling slightly. The trading sessions had been down, up, and finally down. Silver also fell - a little more steeply than gold.
Positive economic news out of China seems to have opened up new risk appetite in equities markets globally as investors look for "hotter" places to invest their money. Tepid U.S. jobs data continued to be a source of weakness for the dollar, which in turn is providing underlying support for gold prices today. At least on that side of the trading equation. However, in regular trading, gold is down about $9. That left us with a small overall decline of $2.30.
Continued concern over a potential U.S.-led Syrian air strike gave gold some continued flight-to-safety support. But, an American proposal today that was quickly embraced by Russia seems to be giving President Obama an opportunity to climb down from his widely disliked plan to bomb Syrian targets. The U.S. and many of its allies are war weary and, if the goal is to stop these weapons from being used again, putting them under international lockdown is a pretty good idea.
The weapons would be safeguarded - and perhaps could be destroyed eventually. It leaves Russia's only remaining Middle East client state solidly under their aegis and saves Russia face. It won't disrupt the world economy, which needs help still in getting healthy. It will shield the U.S. Congress from having to get involved with an unsavory and unpopular vote in the eyes of its constituents.
According to a report from NASDAQ,
managed-money accounts increased their net-long position in gold futures trading, adding 744 gross longs and cutting 2,751 gross shorts, boosting the net-long position to 101,396 contracts. This was the first time the net-long position has been over the 100,000 level since Dec. 31.
HSBC noted that this is the eighth week in a row that speculators covered short positions in futures. Still, they said, gross speculative short positions "are still at historically high levels and leave ample room for further short covering, in our view," the bank said.
Other analysts, however, had differing views, noting that the wind-down has been happening in ultra slow motion, and that the money hasn't been flowing out of shorts into longs proportionately but rather the money is going elsewhere. Commerzbank, HSBC and TD Securities share more or less the latter view.
Here is a reminder of some history, sort of a wildcard thought as we wait for the FOMC meeting on the QE3 tapering matter on the 17th and 18th of the month. This is from Gold Seek:
"Think back to 2003-6 and then interest rates were heading up from a notable low. That might well be the prospect for the next few years if the Fed starts to unwind its QE program from the 18th of this month.
"Gold prices rose by 60 per cent from 2003 to 2006. You might have thought that higher interest rates meant a higher dollar and that would strike gold prices down, but that did not happen back then."
It is possible, certainly that when tapering finally begins, we may get back to the "old normal" of the early 2000s, and some sort of true calculation of inflation will creep into the precious markets.
Wishing you as always good trading,
Gary S. Wagner - Executive ProducerMarket Forecast:On a technical basis there is not a lot of information that can be gleaned from today’s market activity except the consolidation and uncertainty. As the market awaits news about possible military action by the United States in Syria and the current United States Federal Reserve’s position on its quantitive easing program, we find gold trading in a defined and narrow range. But the key question we are attempting to identify is whether or not Friday’s rally signaled a termination or the end of the corrective action in gold prices. Today’s video will explore consolidation within the market and illustrate examples in which the outcome was a pivot point or turning point in the market. We will also look at consolidation in the market historically where it was simply a resting point prior to returning to its current direction. We will also discuss key indicators that we look at to determine as quickly as possible which of these two possible outcomes seems more likely in our current scenario. For the time being we are sidelined with no current trades.
Proper Action :
No open trades we got the first confirmation on Friday that current "C" wave might have concluded. Follow through this week would trigger a buy signal
COT LINK See previous weeks in Historical Commitments of Traders Reports. |
|
|
Gary S. Wagner - Executive Producer