7th november Gold Trend Analysis

In last nights website update — resistance for Monday was listed at 1765-1775 and the high so far today is 1780 spot Forex. Support was listed at 1744-1755 and the low so far today is 1754.

Trades — Long gold at 1724 — sold 1/2 at 1735 —- current STOP 1717 — I’m changing stop to 1739 intra day for the remainder of the day.
Long silver at 32.87 –and 33.60 —sold 1/2 at 34.30 —current stop 32.67 intra day on remainder. I’m changing the stop to 32.87 intra day for the remainder of the day.


London Gold Fix $1,764.00 +8.00

With December gold clawing its way to the highest level since September 22nd overnight and the markets seemingly fearing more trouble in the Euro zone, one gets the impression that gold is shifting back into a move to quality market. In fact, the gold market managed gains earlier this morning in the face of a stronger US dollar, weaker equities and weakness in a host of industrial commodity markets. Since then –all of those markets turned higher and that only added strength to gold.

While some might point to the new government in Greece as a positive development for commodity markets this morning, crude oil, copper, equities and other markets didn’t appear to be up beat on the Euro zone situation as a result of the initial headlines this morning earlier this morning — but as the session wears on — they keep improving and going higher also.

Perhaps move to quality players in gold think there are just too many issues still in play within the Euro zone situation to anticipate a sustained drift away from widespread fears of an eventual chain reaction contagion type meltdown. ITALIAN BONDS ARE ABOVE 6.5% and approaching 7% —- this is the area that analysts have warned is not sustainable AND NEEDS TO BE WATCHED.

With the US scheduled economic report window somewhat thin this week, it is possible that the gold market will take most of its direction from the European headline flow. Some traders think that fears of lower demand for US Treasury supply this week might facilitate an influx of investment back into gold, but that theory won’t be tested until the Tuesday auction of 3 Year notes.

At least in the early action today, there were rumors circulating that the Italian Prime Minister might step down but even that rumor left gold trading near its overnight highs. While equity markets in Asia were mixed during overnight trading, stock indices in Europe have retraced earlier losses and are now up this morning. US equity markets were down hard when things opened up Sunday night in the off market hours- but retraced all of the loss and have opened slightly higher so far. Oil is up 2.50 in Brent, Gasoline up 6 cents, the grains are unchanged for the most part.. The US Dollar was stronger against most of the majors earlier but has given all of its gains.. The Greek Prime Minister and opposition leaders agreed on the formation of a new caretaker government, with a new head of state expected to be chosen today. UK housing prices during October was up 1.2%, higher than market forecasts. Euro zone Retail Sales during September were down 0.7%, weaker than expectations. The only major US economic number to be released today will be a September US Consumer Credit reading at 3:00 PM.

MF GLOBAL showing 593 million still missing this morning — lots of confusion and now everyone trying to follow the money. CME, CFTC, and now the FBI starting a probe.

Going to the chart

The gold market extended last weeks gains and the markets ability to hold the 1750 area over Thursday and Friday finally pushed higher as gold reaches the 1780 area this morning. If we look at the upper dotted trend line, resistance comes in near 1795-1805 area. The Mini red upper line comes in at 1817-1839 area. Those are the two potential area’s that could be a high for the week. Our first target was 1765-1775 as a potential peak for the week —and with price at 1780— it will be interesting to see if we close above the 1770 zone. For the moment it looks like we can move higher towards 1795-1817. We do think that a SHORT TERM PEAK happens this week —— and a 1 to 2 week pullback is favored to come in play. Details are on the website — and I’ll be looking to raise my stop signifcantly after today’s session — and potentially looking for an exit.
In summary — the trend remains up in gold —-BUT WE are getting near a short term peak. For the moment — we feel that the resistance area at 1795-1817 is the next IMPORTANT resistance and most likely area to see a peak this week. I’m BASICALLY GETTING READY TO LOOK FOR AN EXIT on my short term trade — and will update details on the website tonight.



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"For a mountaineer, the important things are the effort, the posture and the muscles. The rope that holds him serves no purpose when everything works but it gives him a sense of security. In the same way, all gold does is ensure confidence; it's a safe haven."