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ngleaftrading.com will be providing us a chart of the week as analyzed by a member of their team. We hope that you enjoy and learn from this new feature.
Weekly Gold Report (March 11th through March 15th)
Will there be a follow through bid up in the US stock indexes this week? That is the million dollar question while Metals remain choppy.
I believe that there is still a bit of upside left in the markets, but not much. If you look back at the reported earnings over the last few weeks, we have seen some fairly good numbers. Many companies have reported better than expected figures, which have given investors a reason to be bullish stocks. The chart pattern shows that investors were waiting for any pullback to buy stocks, and many were ok with buying new highs. It doesn’t get much more bullish than that.
What I find peculiar is the fact that US stock indexes have been able to shrug off poor data from across the pond, and while last week’s unemployment figures were better, not all sectors of our markets have been wildly bullish either.
After 2012, who could blame anyone for tuning in to all reports, both foreign and domestic? There were many days that directional movement in any market could turn on a dime when a report in the US, Europe, Great Britain, or China would miss their mark. But so far this year, things have a different feel. Since the start of 2013, stocks have only had one decent pullback which was promptly bought and corrected over the next three days. And much of this move has been on continued light volume. Traders have been asking, “Who is behind all the buying”?
I would suggest to take a look at a few things. If you take note of the daily chart on Treasuries (a FED favorite), the market has been on a slide. Perhaps the FED has been slowly unwinding Treasury longs and putting money into stocks. Next look at Currencies. For the first time in a few years, foreign Currencies like the Japanese Yen and the British Pound have been under constant pressure, almost worse than the typical plunges in the Dollar. Profit taking from long positions here could be funding this up move in stocks as well.
Regardless of who is behind the move up, I am more interested in where this money goes when the stock indexes do finally correct. Last week, the most frequently asked question was, “what price will be the top in the S&P”? And while I would love to throw out a specific number based on technical analysis, I am not sure what that exact number is. I am less interested in trying to call a top, and more interested in tracking which markets benefit from the profit being taken from stocks when things do turn around.
While the stock indexes have done a terrific job staying positive through a long list of possible land mines like the sequester, through below expected numbers and credit downgrades in Europe, and finally through disappointing news in China, I feel this show will not last must longer. We begin this week without any major Central bank news in the near future and without any noteworthy reports outside of retail sales on Wednesday. So I plan to keep an eye on the closing prices of the stock indexes. If we see a lack of follow through bidding, I will be on the lookout for whether Gold benefits from the profit taking. If you look at the strength of the US Dollar and the nice move up in the indexes, and compare that to the choppy Gold trade, it seems possible that Gold could actually be waiting for the profit taking before moving up. Only time will tell.
If you would like to speak with me directly about this report or about trading Futures and Futures Options, please feel free to contact me by phone at (888) 272-6926 or by email at
bb****@lo*************.com
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Thank you for your interest,
Brian Booth
Senior Market Strategist
bb****@lo*************.com
888.272.6926
** There is a substantial risk of loss in trading futures and options. Past performance is not indicative of future results. The information and data contained in this article was obtained from sources considered reliable. Their accuracy or completeness is not guaranteed. Information provided in this article is not to be deemed as an offer or solicitation with respect to the sale or purchase of any securities or commodities. Any decision to purchase or sell as a result of the opinions expressed in this article will be the full responsibility of the person authorizing such transaction.
Now bulls are caught, finding way to unwind position, every jump is like a trial to create Bull illusion, but failed to attract any fresh buying, resulted un sustainable jumps, due to poor market support.
KEEP AWAY FRO FRESH BUYING, SALE ON EVERY RISE.
Not so fast! Sentiment is bearish enough for this to be a potential bottom, just above long term support. Wait for a stock market correction an frigthened sheep will flock back to mummy gold, although maybe not for long.
Yes henri you are right, ther is good chance of one bounce from long term support line, however it is quite illusive, and afterwards, berish trend re-start with faster break of such support line.
plese send gold report
Dear Vinay,
Are you from which city or country? for which report you are asking for? you may contact me on 91 94279 74838, or you can mail on somnathdada at the rate yahoo.co.in
Are you from which city? and asking for which report? you may contact on 91 94279 74838
plese send gold and silver report
Strong opinions=bad trading
I do not trade gold or the other precious metals. I bought them at relatively much lower prices and I will hold them untill I need them to buy the necessities, when the banker's paper pyramid collapses.
Any idea when the paper pyramid might collapse ?
I do believe that they will find ways to stretch the whole system at least a few more years.
Yeah, those predictions have been made for many decades. The current time one is looking at causes a prism to be unobjective.... it always seems worse or more scary at the time a person is in at the very present. That said, there has got to be a point where the debt piper has to be paid. No one knows what that point is, no matter what they tell you. There are too many variables. Countless variables actually, that do their best to make fools out of as many as possible.
It is not a prediction, it is a mathematical certainty. If things don't appear to be as bad as they should be given the fundamentals and drawing conclusions from critical thinking skills, then you can be assured that they are far worse than you had even supposed.
Think summer of 2007 for example, long after the real estate bubble had burst and credit markets had seized up (they know NOTHING!) The denial and delusion was still so prominent that markets kept going up into Sept and did not "crash" until more than a year later. Fighting the inevitable through years of loose monetary policy only delayed the inevitable and brought the global banking system to the verge of collapse.
This time will be no different except perhaps much worse due to the much higher levels of debt, unemployment, middle class wealth and home equity. Plus, there is nothing left the Fed can do but inflate this festering bad debt (and the $trillions of new bad debt that will spread like wildfire) away.
You can not print wealth or jobs or businesses, only paper money which has a limited shelf life before becoming devalued compared to other hard assets like gold. It has been happening for 12 years and will continue to happen until fair value is found, free of the machinations of short term paper gold and ETF trading. Just because it hasn't happened yet doesn't mean it won't happen, it means that when it does happen, the end result will be worse...
smart Carlos!
Very smart and perfect observation...........simply classic.............
Humbly, I thank you all.
I DO NOT believe the global (American “miracle” or otherwise) recovery b. s. Trillions of Central Banks’ paper floating around the world has to go somewhere, thus creating an ILLUSION of a recovery. I do believe that the basic laws of Economics that dictate that you CAN NOT create true wealth from debt and printed paper still hold true.
Those who keep saying "gold doesn't have a yield" are mentally challenged:
1.- What good is a 2%-3% yield (below the inflation rate), which most paper investments pay today, when the PRINCIPAL plunges by 10%-50% -90%-100%?
2.- Gold does not PAY a dividend. True. Who cares?!! It has a BUILT IN YIELD IN THE PRINCIPAL. If this were not true, gold would still be at $20/oz!!! This built in yield, presently at a compounded 7.3%/yr rate, took gold from $35 in 1959 to $1580 today. I believe this is the Global Inflation Rate that is built into gold! So, as I said, WHO CARES?!!!
3.- Gold in banker's vaults makes them ALL POWERFULL. Gold in people's hands becomes the Banker's KRYPTONITE (Superman comics and movies). It renders bankers powerless to play paper games.