March 30
04.00 P.M GMT
Long Term=Up (major resistance held the uptrend – Need monthly closes above 1767-1804)
Medium Term=NEUTRAL (Major Resistance 1767 Monthly Close)
Intermediate Term=Down---The North American Winter seasonal correction looks complete – spring rally is next. The ‘trend’ has not turned up yet on an intermediate term basis.
Short Term= Neutral– Short term cycles look to have bottomed --- support is now 1644-1650
Support and Resistance for Friday
Initial Resistance for 1666-1675 and 2nd tier 1681-1688
Initial Support 1645-1655 and 1626-1634
Outlook for Friday
What Next?
Bottom Line
01.00 A.M GMT
"Nothing's moving, everyone's waiting."
"The view that the US economic recovery is looking more sustainable is becoming increasingly accepted," wrote UBS analysts Edel Tully and Julien Garran in a new report on Wednesday, slashing the Swiss banks's 2012 average Gold Price target by 18% to $1680.
"Gold is at risk, for it needs persistent inflows of investor money to keep it on its upward trajectory."
"Investors need to put in well over $100 billion to the gold market in 2012 to keep prices high," said GFMS chairman Philip Klapwijk at a CME conference in Singapore today, quoted by Reuters.
Jewelry demand in India - the world's #1 consumer market - "was reasonably positive" in the first two months of 2012, according to GFMS's Klapwijk, but the hike in India's gold import duties is denting sales.
Economic Events Scheduled for March 30, 2012
( last business day of the month )
T.B.D. GBP Nationwide HPI (MoM) 0.2% 0.6%
The Nationwide Housing Price Index (HPI) measures the change in the selling price of homes with mortgages backed by Nationwide. It is the U.K.’s second earliest report on housing inflation.
07:45 EUR French Consumer Spending (MoM) 0.2% -0.4%
French Consumer Spending measures the change in the inflation-adjusted value of all goods expenditures by consumers. Consumer spending accounts for the majority of economic activity.
08:00 CHF KOF Leading Indicators 0.08 -0.12
The KOF Leading Indicators Index is designed to predict the direction of the economy over the following six months. The index is a composite reading of 12 economic indicators related to banking confidence, production, new orders, consumer confidence and housing.
10:00 EUR CPI (YoY) 2.5% 2.7%
The Consumer Price Index (CPI) measures the change in the price of goods and services from the perspective of the consumer. It is a key way to measure changes in purchasing trends and inflation.
13:30 USD Core PCE Price Index (MoM) 0.1% 0.2%
13:30 USD Personal Spending (MoM) 0.6% 0.2%
The Core Personal Consumption spending (PCE) Price Index measures the changes in the price of goods and services purchased by consumers for the purpose of consumption, excluding food and energy. Prices are weighted according to total expenditure per item. It measures price change from the perspective of the consumer. It is a key way to measure changes in purchasing trends and inflation.
14:45 USD Chicago PMI 63.1 64.0
The Chicago Purchasing Managers’ Index (PMI) determines the economic health of the manufacturing sector in Chicago region. A reading above 50 indicates expansion of the manufacturing sector; a reading below indicates contraction. The Chicago PMI can be of some help in forecasting the ISM manufacturing PMI.
14:55 USD Michigan Consumer Sentiment Index 75.1 74.3
The University of Michigan Consumer Sentiment Index rates the relative level of current and future economic conditions. There are two versions of this data released two weeks apart, preliminary and revised. The preliminary data tends to have a greater impact. The reading is compiled from a survey of around 500 consumers.
13:30 CAD GDP (MoM) 0.1% 0.4%
Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health. Canada releases fresh GDP data on a monthly basis.
March 29
04.00 P.M GMT
04.00 P.M GMT
This week’s price was right on the lower bottom blue trend line. As long as we hold that area, the trend is up. On the upside we need a close above 1681 -- just above the upper dotted line ---and it’s a Martin Armstrong key weekly number. The red short term cycle is in play . PRICE IS STUCK between a downtrend line and an uptrend one. Odds favor the upside is in play—but we need to get above that channel line. The next blue CIRCLE of trend changes is not due until April 7th.
Yesterday’s low was our short term line in the sand---if we close below 1644, I’d have to rethink my April focus of higher price. And if we close above 1681 it keeps the uptrend intact. IN BETWEEN THE TWO LINES leaves us neutral. SUPPORT for the remainder of the day is the 1651-1655 and resistance is 1668—1674) .
When we weigh it all up, the trend still has the upside in its favor. 1655 s a monthly reversal PRICE POINT -- if we get a sell off that's where it should land to test. On the upside the 1669-1674 area is resistance. When we add it all up -- we have to favor higher into next week. As long as we're above the Thursday low -- the upside is in play.
ITS THE END OF THE QUARTER -- be careful. It will surprise me if we don't pullback at test 1655 on the low end. On the high end, 1669-1674 is the price to beat.
10.00 A.M GMTLong Term=Up (major resistance held the uptrend – Need monthly closes above 1767-1804)
Medium Term=NEUTRAL (Major Resistance 1767 Monthly Close)
Intermediate Term=Down---The North American Winter seasonal correction looks complete – spring rally is next. The ‘trend’ has not turned up yet on an intermediate term basis.
Short Term= Neutral– Short term cycles look to have bottomed --- support is now 1644-1650
Support and Resistance for Friday
Initial Resistance for 1666-1675 and 2nd tier 1681-1688
Initial Support 1645-1655 and 1626-1634
Outlook for Friday
It’s the last trading day of the quarter---so it’s an anything goes type of day.
I’ve seen big move days, and as reader John points out – lets be aware that the ‘control boyz’ won’t want to see a high price. The 1655 area is the key ---- we need to close above 1651-1655 on FRIDAY to keep the uptrend alive on a medium term basis. A CLOSE ABOVE 1681 will add to upside advantage. They are going to probably ‘goose’ the stock market and everything else might just follow along. The ‘control boyz’ will DEFINITELY TRY AND CONTAIN 1681 on a worse case basis. They will also try and defend 1666-1676 those are the two spots on the upside. On the downside---a massively important monthly reversal is at the 1651-1655 area. We can’t rule out a RETURN there on Friday to ‘fight it out.’ That’s the most probable range on the up and downside to watch.
GOLD SENTIMENT IS AT AN EXTREME –rare that it goes this low---and usually doesn’t hang around this area as Hulbert Digest’s reading of only a 5% bull reading. There are plenty of bullish factors to go around, but when price doesn't agree, we have no choice but to wait until it does. TODAY’s UPSIDE REVERSAL looked good on the charts.
What Next?
Our ranges worked out great on Thursday on both the up and downside and with the price reversal we saw on Thursday, it’s possible we’re going to trade in the 1650-1670 area on Friday. But it’s the end of the quarter and if the big hedge funds jump in on the long side, it could get interesting. If we do get above 1670, the key will be a close above 1681. If we get that it should favor higher into Easter weekend.
We enter Friday neutral on the short term and still bearish on the upside---so there’s still one more PUSH HIGHER NEEDED to gain the upside advantage.
We’re really in neutral zone here but Friday has the (SLIGHT) advantage on the upside.
We’re still in favor that the low on the 22nd (our ideal day for a low this month) is still in play. However, if we close below 1650 in spot, then we have to REVISIT the outlook.
The chart shows the lower green channel line that we drew in over a month ago, HAS HELD EVERY pullback but that one day at 1628. Now we need to get above the middle green area and the DOTTED RED LINES next. Since we have not broken the downtrend yet, we need to remain cautious just a bit longer until we get above that red dotted line.
Bottom Line
Price held where it had to and now we need to get above 1665-1675 and close the week above 1681. If we can pull that off, the trend will be up next week.
Sentiment, seasonal, and short term cycles still favor higher and now it takes a close below the Thursday for the downside to be favored. Its last trade day of the quarter. There have been big PRICE moves in the past at end of month, so let’s be ready. While we might not have much firework, 50 dollar days at end of month have much greater potential than most other days.
BE CAREFUL NEAR 1665-1670 – THAT’s where they try to stop it the first time on Friday Morning. The reversal Thursday was key, now we need the follow thru.01.00 A.M GMT
"Nothing's moving, everyone's waiting."
"The view that the US economic recovery is looking more sustainable is becoming increasingly accepted," wrote UBS analysts Edel Tully and Julien Garran in a new report on Wednesday, slashing the Swiss banks's 2012 average Gold Price target by 18% to $1680.
"Gold is at risk, for it needs persistent inflows of investor money to keep it on its upward trajectory."
"Investors need to put in well over $100 billion to the gold market in 2012 to keep prices high," said GFMS chairman Philip Klapwijk at a CME conference in Singapore today, quoted by Reuters.
Jewelry demand in India - the world's #1 consumer market - "was reasonably positive" in the first two months of 2012, according to GFMS's Klapwijk, but the hike in India's gold import duties is denting sales.
Gold extended their losses to a third consecutive day, tracking U.S. equities and other commodities such as oil as markets were engulfed by pessimism and traders avoided assets considered riskier. Gold closed at 1652.20 down 5.70.
Investors sentiment turned negative today, as worries over Spanish debt crept back into the markets.
Investors sentiment turned negative today, as worries over Spanish debt crept back into the markets.
In Spain, the unions called a national workers strike against austerity measures imposed by the government. On Friday EU finance ministers meet to discuss building a stronger firewall as demanded by the G20 partners.
Earlier in the week gold was forecast to make one more run up to the 1700 level. This was provided courtesy of Fed Chairman Bernanke, who sent gold skyrocketing when he mentioned a possibility of future monetary easing. Gold was unable to pass the resistance at 1700 and has fallen for the past few days as investors continue to take profits as gold falls.
UBS today lowered it’s 2012 gold forecast by 18% to $1,680/oz on continued improvement in economic outlook, particularly in U.S. UBS analysts said continued strong U.S. data see markets start pricing in possibility of higher interest rates before 2014.
Silver which has been tracking gold lately, traded up today at 32.207.
( last business day of the month )
T.B.D. GBP Nationwide HPI (MoM) 0.2% 0.6%
The Nationwide Housing Price Index (HPI) measures the change in the selling price of homes with mortgages backed by Nationwide. It is the U.K.’s second earliest report on housing inflation.
07:45 EUR French Consumer Spending (MoM) 0.2% -0.4%
French Consumer Spending measures the change in the inflation-adjusted value of all goods expenditures by consumers. Consumer spending accounts for the majority of economic activity.
08:00 CHF KOF Leading Indicators 0.08 -0.12
The KOF Leading Indicators Index is designed to predict the direction of the economy over the following six months. The index is a composite reading of 12 economic indicators related to banking confidence, production, new orders, consumer confidence and housing.
10:00 EUR CPI (YoY) 2.5% 2.7%
The Consumer Price Index (CPI) measures the change in the price of goods and services from the perspective of the consumer. It is a key way to measure changes in purchasing trends and inflation.
13:30 USD Core PCE Price Index (MoM) 0.1% 0.2%
13:30 USD Personal Spending (MoM) 0.6% 0.2%
The Core Personal Consumption spending (PCE) Price Index measures the changes in the price of goods and services purchased by consumers for the purpose of consumption, excluding food and energy. Prices are weighted according to total expenditure per item. It measures price change from the perspective of the consumer. It is a key way to measure changes in purchasing trends and inflation.
14:45 USD Chicago PMI 63.1 64.0
The Chicago Purchasing Managers’ Index (PMI) determines the economic health of the manufacturing sector in Chicago region. A reading above 50 indicates expansion of the manufacturing sector; a reading below indicates contraction. The Chicago PMI can be of some help in forecasting the ISM manufacturing PMI.
14:55 USD Michigan Consumer Sentiment Index 75.1 74.3
The University of Michigan Consumer Sentiment Index rates the relative level of current and future economic conditions. There are two versions of this data released two weeks apart, preliminary and revised. The preliminary data tends to have a greater impact. The reading is compiled from a survey of around 500 consumers.
13:30 CAD GDP (MoM) 0.1% 0.4%
Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health. Canada releases fresh GDP data on a monthly basis.
March 29
04.00 P.M GMT
A trading range has built up between the 1650-1670 area and it's become a battle of the traders and markets. I can see it in the action as it gets very frenzied in trade and then calms down. Each side is supporting its territory as the buy and sell orders pile up on each side. This is in line with what we expected today from last nights web update as price consolidates before the next move. When we add it all up -- seasonal, short term trend, end of month, sentiment -- it favors up. However, the NEGATIVE is the slowdown or anticipated slowdown in China and the lingering debt issues in Europe.
SUPPORT IS THE 1650-1655 area ------ and resistance is the 1665-1675 area. The trend decision will probably not be made today -- but it does seem like the weight of the data has a slight bias to the upside. In summary --- metals are in a trade range ---- IF GOLD CLOSES BELOW 1644 --- IT WILL INCREASE the BEAR side.
For now --- we're neutral and the upside has a SLIGHT ADVANTAGE over all, but the move will probably not develop today --- and will be more trading range bound.
01.00 P.M GMT
Buying gold around 1650.00, targeting 1681.00, 1694.00 and 1709.00 and stop loss with 4-hour closing below 1624.00 might be appropriate.
04.00 A.M GMT
Long Term=Up (major resistance held the uptrend – Need monthly closes above 1767-1804)
Medium Term=NEUTRAL (Major Resistance 1767 Monthly Close)
Intermediate Term=Down---The North American Winter seasonal correction looks complete – spring rally is next. The ‘trend’ has not turned up yet on an intermediate term basis.
Short Term= down – Short term cycles look to have bottomed --- support is now 1644-1650
Support and Resistance for Thursday
Initial Resistance for 1666-1676 and 2nd tier 1683-1688
Initial Support 1643-1651 and 1626-1634
Outlook for Thursday
Short Term - down
Cycles –
What Next?
Bottom Line
If we can't get above 1665-1675 and if we can't close the week above 1681, then the short term trend will be in danger of breaking down into a cycle inversion. Sentiment, seasonal, and short term cycles still favor higher. However, a close below 1644 and we'll favor lower prices.
Thus 1644-1675 is neutral --- above 1681 bullish and below 1644 bearish.
01.00 A.M GMT
Economic Reports for March 29, 2012 Europe and Americas
08:55 EUR German Unemployment Rate 6.8% 6.8%
The German unemployment rate measures the percentage of the total work force that is unemployed and actively seeking employment during the reported month.
08:55 EUR German Unemployment Change -10K 0K
German Unemployment Change measures the change in the number of unemployed people during the previous month.
13:30 USD Initial Jobless Claims 350K 348K
13:30 USD Continuing Jobless Claims 3365K 3352K
Initial Jobless Claims measures the number of individuals who filed for unemployment insurance for the first time during the past week. This is the earliest U.S. economic data, but the market impact varies from week to week.
13:30 USD GDP Price Index (QoQ) 0.9% 0.9%
The GDP Price Index measures the annualized change in the price of all goods and services included in gross domestic product. It is the broadest inflationary indicator.
13:30 USD GDP (QoQ) 3.0% 3.0%
Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health.
17:45 USD Fed Chairman Bernanke Speaks
Federal Reserve Chairman Ben Bernanke (February 2006 – January 2014) is to speak. As head of the Fed, which controls short term interest rates, he has more influence over the U.S. dollar’s value than any other person. Traders closely watch his speeches as they are often used to drop hints regarding future monetary policy.
March 28
Support for the remainder of the day is the 1651-1655 area. Resistance is now the 1681-1685 area.
06.00 A.M GMT
The 1665-1675 area (more so 1675) should be tested on pullbacks, but other than that, odds favor higher on Wednesday.
Long Term=Up (major resistance held the uptrend – Need monthly closes above 1767-1804)
Medium Term=NEUTRAL (Major Resistance 1767 Monthly Close)
Intermediate Term=Down---The North American Winter seasonal correction looks complete – spring rally is next. The ‘trend’ has not turned up yet on an intermediate term basis.
Short Term=up – Short term cycles look to have bottomed --- support is now 1644-1650
Support and Resistance for Wednesday
Initial Resistance for 1688-1698 and 2nd tier 1706-1714
Initial Support 1667-1677 and 1651-1655
RECAP
Buying gold around 1650.00, targeting 1681.00, 1694.00 and 1709.00 and stop loss with 4-hour closing below 1624.00 might be appropriate.
04.00 A.M GMT
Long Term=Up (major resistance held the uptrend – Need monthly closes above 1767-1804)
Medium Term=NEUTRAL (Major Resistance 1767 Monthly Close)
Intermediate Term=Down---The North American Winter seasonal correction looks complete – spring rally is next. The ‘trend’ has not turned up yet on an intermediate term basis.
Short Term= down – Short term cycles look to have bottomed --- support is now 1644-1650
Support and Resistance for Thursday
Initial Resistance for 1666-1676 and 2nd tier 1683-1688
Initial Support 1643-1651 and 1626-1634
The gold Forex tick chart shows that --29 million ounces more sold on the bid (selling) than the ask price. And that was at noon----by the Globex close, the number was a staggering 39 million ounces. Look how OBV (on balance volume) went from 13 to 29 million ounces in less than a hour. And yet, we are to believe this is normal behavior?
after having watching gold move up to 1698 on Tuesday’s option expiration day, the reality of manipulation was seen full force on Wednesday and prices were dropped like a hot potato and a full Fibonacci 61% retracement took place on Wednesday. While we were expecting a potential to trade down to the 1665-1675 area, we were not expecting price to move any lower than that. It seems like the ‘control boyz’ prints are all over the place. Things get crazier more and more each day. This is one of the reasons I’m trading in small contracts. It’s the only way one can survive the wide price swings. It is paramount to keep focus on the LOSS potential.
Today’s drop adds to the speculation that the ‘control boyz’ move gold to 1700 on TUESDAY to have the lowest option price payout. That’s what TUESDAY was all about---and it’s criminal, but that what the markets have become.
Outlook for Thursday
This time around, mid-week Wednesday has provided a low for the week. Even with all the bullish factors---seasonal, sentiment, cycles, and a printing press that churns out a trillion every three months, the situation remains precarious. We were looking for a pullback to 1665-1675 last night before moving higher and now that area should provide resistance on Thursday.
The fact that we dropped below that area on Wednesday leaves open the potential for a cycle inversion and LEAVES the situation one where we favor a consolidation and potentially lower prices. Look for a range of 1665-1673 on the upside and the 1646-1656 area on Thursday.
GOLD SENTIMENT IS AT AN EXTREME –rare that it goes this low---and usually doesn’t hang around this area as Hulbert Digest’s reading of only a 5% bull reading. There's plenty of bullish factors to go around, but when price doesn't agree, we have no choice but to wait until it does.
Short Term - down
Cycles –
The failure at 1670-1675 has put the short term cycle in jeopardy. If a cycle inversion occurs and price closes below the up trending dotted line – the short term will favor lower prices and a potential where we could see lower prices into the week of April 7th.
In summary---the upside is still in play, but the danger of a down turn has significantly increased. As we’ve discussed in the past, until the LOWS are made on the blue cycle instead of the red, then the correction that began in August is still in play. Not that we won’t go higher, but that the upside will be limited. Thus, at some point, we’re going to have a cycle inversion where price will at some point break lower and will fail a red cycle and will move lower into a blue cycle time zone.
What Next?
Our outlook for a mid week Wednesday high failed and about the only thing we can say that has any hope for the short term trend is the fact that we held the 1655 area.
Thursday favors 1666-1676 to be first resistance. First support comes in near 1650-1655. We’re still in favor that the low on the 22nd (our ideal day for a low this month) is still in play. However, if we close below 1650 in spot, the potential for another sharp drop lower could be in play.
The red dotted resistance trend line held price in check and now the lower Green area on the chart is the last support before 1600. First Resistance is 1666-1676 area. For now, the overall trend is ready to shift back to the bear’s. IF WE FAIL TO CLIMB BACK ABOVE 1681 on a FRIDAY BASIS, the trend will favor lower. IF WE BREAK DOWN from here, expect the move to be another hard leg down to 1570-1605 with the potential for more. Watch that LOWER GREEN AREA – a move below there and we’ll favor 1600.
Bottom Line
If we can't get above 1665-1675 and if we can't close the week above 1681, then the short term trend will be in danger of breaking down into a cycle inversion. Sentiment, seasonal, and short term cycles still favor higher. However, a close below 1644 and we'll favor lower prices.
Thus 1644-1675 is neutral --- above 1681 bullish and below 1644 bearish.
01.00 A.M GMT
GOLD slumped more than $20 overnight to touch a low as 1654 before support saw the price rebound a few dollars to open this Asian morning at 1662, on the back of a broadly weak market sentiment. The US equity market had its largest decline in 3 weeks dragging commodities with it as new orders for long-lasting U.S. factory goods rose less than expected in February and a gauge of future business investment also fell short of forecasts, casting a shadow on the manufacturing sector's support of the recovery, while window-dressing for the quarter by funds is seen fading away. A slump in crude price also did nothing to help the fall as investors' demand for gold to protect against inflation diminishes. We maintain a neutral outlook for gold in both the short and medium term, as we believe investors' confidence in gold relies heavily on the existence of an upward price trend, which is unclear currently. Look out for support oat1654 and strong resistance at 1700.
Economic Reports for March 29, 2012 Europe and Americas
08:55 EUR German Unemployment Rate 6.8% 6.8%
The German unemployment rate measures the percentage of the total work force that is unemployed and actively seeking employment during the reported month.
08:55 EUR German Unemployment Change -10K 0K
German Unemployment Change measures the change in the number of unemployed people during the previous month.
13:30 USD Initial Jobless Claims 350K 348K
13:30 USD Continuing Jobless Claims 3365K 3352K
Initial Jobless Claims measures the number of individuals who filed for unemployment insurance for the first time during the past week. This is the earliest U.S. economic data, but the market impact varies from week to week.
13:30 USD GDP Price Index (QoQ) 0.9% 0.9%
The GDP Price Index measures the annualized change in the price of all goods and services included in gross domestic product. It is the broadest inflationary indicator.
13:30 USD GDP (QoQ) 3.0% 3.0%
Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health.
17:45 USD Fed Chairman Bernanke Speaks
Federal Reserve Chairman Ben Bernanke (February 2006 – January 2014) is to speak. As head of the Fed, which controls short term interest rates, he has more influence over the U.S. dollar’s value than any other person. Traders closely watch his speeches as they are often used to drop hints regarding future monetary policy.
March 28
Support for the remainder of the day is the 1651-1655 area. Resistance is now the 1681-1685 area.
06.00 A.M GMT
The 1665-1675 area (more so 1675) should be tested on pullbacks, but other than that, odds favor higher on Wednesday.
Long Term=Up (major resistance held the uptrend – Need monthly closes above 1767-1804)
Medium Term=NEUTRAL (Major Resistance 1767 Monthly Close)
Intermediate Term=Down---The North American Winter seasonal correction looks complete – spring rally is next. The ‘trend’ has not turned up yet on an intermediate term basis.
Short Term=up – Short term cycles look to have bottomed --- support is now 1644-1650
Support and Resistance for Wednesday
Initial Resistance for 1688-1698 and 2nd tier 1706-1714
Initial Support 1667-1677 and 1651-1655
RECAP
Gold prices rallied to resistance range and registered a high at $1696. In addition to the short term cycles we feel that it was more than coincidence that the ‘control boyz’ got price close to 1700 and options expired in the best possible position for their payout.
As I’ve stated many times, my own speculation and it is PURE speculation, is that the ‘control boyz’ are allowed to make the maximum amount of money in the options markets and that’s what they use to fund their short position programs.
Gold bottomed at $1679 on the Comex and silver, after taking out $33 on the upside in early London trading, fell to $32.50 before recovering. The sell-off was at the 10am-11am time frame where the biggest moves in New York occur. (9am-11:30am) NOTE: On a BULLISH DAY, it can be where the biggest moves to the upside occur. Here’s the chart below---keep in mind this is an “AVERAGE” and not an everyday event. But it is the most likely time during the day where the big moves occur.
28GOLINTRAveDM
Gold had a decent move for the day, but the HUI didn’t do much once again and it remains below the key 500 level. The seasonal upturn that is coming due in gold is also due for the gold stocks. It’s going to be interesting when the overall stock market finally gets its correction as to whether the gold stocks follow or whether they ignore it (assuming that gold rises of course).
Outlook for Wednesday
we got the Tuesday bounce and with Mid Week Wednesday on tap that usually has the odds on the upside. When we say usually, we are not hedging ourselves; we are stating the case as it is. There are odds, but no absolutes. If we maintain that type of attitude, we help ourselves remain flexible when things don’t go our way and it makes it easier to take a small loss, knowing that trading is like a baseball player in that we can’t get a hit every time at bat.
The ideal target date of March 22nd as the low for the month is still in place and as we are above 1651 on a closing basis, the short term trend favors higher. With options expiration out of the way, gold will trade with less manipulation. With gold reaching almost 1700 on Tuesday, we should see a pullback to 1665-1675 as a normal occurrence. Even a pullback to 1650-1655 is something we need to be prepared for, but for now we favor 1665-1675 as the lows for Wednesday. The end of the months usually favors higher prices
If the short term cycles have kicked in, we should get a test of the 1705-1736 area in gold. The North American Seasonal downtrend is also due to end and the end of months has been more on the bullish end of price for gold. So there’s a lot to favor a price low. Finally, GOLD SENTIMENT IS AT AN EXTREME –rare that it goes this low---and usually doesn’t hang around this area as Hulbert Digest’s reading of only a 5% bull reading. That is yet another bullish factor at the moment. With all of that, we have to give the upside the edge on Wednesday. The 1665-1675 area (more so 1675) should be tested on pullbacks, but other than that, odds favor higher on Wednesday.
The ideal target date of March 22nd as the low for the month is still in place and as we are above 1651 on a closing basis, the short term trend favors higher. With options expiration out of the way, gold will trade with less manipulation. With gold reaching almost 1700 on Tuesday, we should see a pullback to 1665-1675 as a normal occurrence. Even a pullback to 1650-1655 is something we need to be prepared for, but for now we favor 1665-1675 as the lows for Wednesday. The end of the months usually favors higher prices
If the short term cycles have kicked in, we should get a test of the 1705-1736 area in gold. The North American Seasonal downtrend is also due to end and the end of months has been more on the bullish end of price for gold. So there’s a lot to favor a price low. Finally, GOLD SENTIMENT IS AT AN EXTREME –rare that it goes this low---and usually doesn’t hang around this area as Hulbert Digest’s reading of only a 5% bull reading. That is yet another bullish factor at the moment. With all of that, we have to give the upside the edge on Wednesday. The 1665-1675 area (more so 1675) should be tested on pullbacks, but other than that, odds favor higher on Wednesday.
What Next?
Last night’s favored move to 1693-1704 played out as we came in at 1697. With mid week Wednesday here, the odds have the advantage. Wednesday again favors 1693-1704 to be first resistance. First support comes in near 1655-1665. There is also minor support at 1677-1681. Tuesday’s low at 1679 was within this range and could potentially play an important part on Wednesday also. We’re still in favor that the low on the 22nd (our ideal day for a low this month) is still in play.
The red dotted trend line has resistance at the 1694-1698 area. First Support is 1665-1675. Other considerations in this area are for 1681---as it is a Martin Armstrong key reversal price point so a close on Friday above that level is key point for gold to achieve. Also 1688 is the FEB low in price so that’s going to be an important point to watch (1688-1692).
The red dotted trend line has resistance at the 1694-1698 area. First Support is 1665-1675. Other considerations in this area are for 1681---as it is a Martin Armstrong key reversal price point so a close on Friday above that level is key point for gold to achieve. Also 1688 is the FEB low in price so that’s going to be an important point to watch (1688-1692).
Bottom Line
we got out push higher on Tuesday. We’ll look for pullback testing of 1665-1675 – and this is probably the area that determines whether we turn around and make a new high on Mid Week Wednesday. I keep updating the chart below by hand as the GANN ANGLE overlay we did at the beginning of the month has provided the key resistance and support with the dotted red trend lines and is the most reliable support and resistance chart I have at the moment.
Note how Tuesday’s high was up against the upper red dotted trend line. This puts a bit of CAUTION as a potential high for the week and we can’t RULE OUT a pullback from here. We’d like to see the 1675 area hold and would like to SEE A CLOSE ABOVE 1688 (the February low). This would add potential that the down trending dotted RED line will be broken. That’s the spot to watch at the moment --- so 1688-1698 is important on Wednesday. The odds favor a range day of 1665-1675 on the downside and 1688-1698 on the upside. WITH THAT DOTTED RED line hit on Tuesday, pullback testing and how deep we pullback will help gauge the current strength. IN SUMMARY – we’ve gotten a bounce to some key resistance so gold still has this one barrier to get above here in order to above 1700. Look at the FEB lows (upper green area) in the 1705 zone. That 1705-1727 area is the most important RESISTANCE to overcome to turn the trend up in the intermediate term and for April.
00.30 A.M GMTNote how Tuesday’s high was up against the upper red dotted trend line. This puts a bit of CAUTION as a potential high for the week and we can’t RULE OUT a pullback from here. We’d like to see the 1675 area hold and would like to SEE A CLOSE ABOVE 1688 (the February low). This would add potential that the down trending dotted RED line will be broken. That’s the spot to watch at the moment --- so 1688-1698 is important on Wednesday. The odds favor a range day of 1665-1675 on the downside and 1688-1698 on the upside. WITH THAT DOTTED RED line hit on Tuesday, pullback testing and how deep we pullback will help gauge the current strength. IN SUMMARY – we’ve gotten a bounce to some key resistance so gold still has this one barrier to get above here in order to above 1700. Look at the FEB lows (upper green area) in the 1705 zone. That 1705-1727 area is the most important RESISTANCE to overcome to turn the trend up in the intermediate term and for April.
SPOT GOLD closed lower on Tuesday and the lowrange close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI have turned bullish signalling that sideways to higher prices are possible nearterm. If it extends the rally off last Thursday's low, the reaction high crossing is the next upside target. If it renews the decline off February's high, the 75% retracement level of the DecemberFebruary rally crossing is the next downside target.
Economic Events March 28, 2012 Europe and America
06:30 EUR French GDP (QoQ) 0.2% 0.2%
Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health.
09:30 GBP Business Investment (QoQ) -5.4% -5.6%
Business Investment measures the change in the total inflation-adjusted value of capital expenditure made by companies in the private sector.
09:30 GBP Current Account -8.4B -15.2B
The Current Account index measures the difference in value between exported and imported goods, services and interest payments during the reported month. The goods portion is the same as the monthly Trade Balance figure. Because foreigners must buy the domestic currency to pay for the nation’s exports the data can have a sizable affect on the GBP.
09:30 GBP GDP (QoQ) -0.2% -0.2%
Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health.
T.B.D. EUR German CPI (MoM) 0.3% 0.7%
The German Consumer Price Index (CPI) measures the changes in the price of goods and services purchased by consumers.
13:30 USD Core Durable Goods Orders (MoM) 1.5% -3.0%
13:30 USD Durable Goods Orders (MoM) 3.0% -3.7%
Core Durable Goods Orders measures the change in the total value of new orders for long lasting manufactured goods, excluding transportation items. Because aircraft orders are very volatile, the core number gives a better gauge of ordering trends. A higher reading indicates increased manufacturing activity. Durable Goods Orders measures the change in the total value of new orders for long lasting manufactured goods, including transportation items.
March 27
04.00 P.M GMT
10.00 A.M GMT
With options expiration tomorrow, odds favor we see the 1700-1705 on the upside and 1677-1685 on the downside.
Long Term=Up (major resistance held the uptrend – Need monthly closes above 1767-1804)
Medium Term=NEUTRAL (Major Resistance 1767 Monthly Close)
Intermediate Term=Down---The North American Winter seasonal correction is about complete
Short Term=up – support is now 1644-1650
Support and Resistance for Monday
Initial Resistance for 1692-1705 and 2nd tier 1712-1716
Initial Support 1667-1677 and 1651-1655
Tuesday favors 1693-1704 to be first resistance. First support comes in near 1655-1665. There is also minor support at 1677-1681.
The option boys will most likely be running it up there on Tuesday and we’ll most likely get a push higher into Wednesday.
00.30 A.M GMT
Economic Events Scheduled for March 27, 2012
All Day G7 Meeting
The G7 meeting is the meeting of the finance ministers from the group of seven industrialized nations that are the United States, Japan, Germany, France, United Kingdom, Italy and Canada. The meeting takes place several times a year to discuss economic policy. Traders should pay close attention to this event as it might bring a new dimension to the markets.
07:00 EUR GfK German Consumer Climate 6.2 6.0
The Gfk German Consumer Climate Index measures the level of consumer confidence in economic activity. The data is compiled from a survey of about 2,000 consumers which asks respondents to rate the relative level of past and future economic conditions.
11:00 GBP CBI Distributive Trades Survey -4 -2
The Confederation of British Industry (CBI) Distributive Trades Survey (DTS) measures the health of the retail sector. The reading is compiled from a survey covering 20,000 firms responsible for 40% of employment in retailing. It includes measures of sales activity across the distributive trades. It is a leading indicator of consumer spending. The figure is the difference between the percentage of retailers reporting an increase in sales and those reporting a decrease.
13:00 USD S&P/Case-Shiller Home Price Indices -3.8% -4.0%
The S&P/Case-Shiller Home Price Indices released by the Standard & Poor’s examines changes in the value of the residential real estate market in 20 regions across the US. This report serves as an indicator for the health of the US housing market. Generally speaking, a high reading is seen as positive (or bullish) for the USD, while a low reading is seen as negative, or bearish.
14:00 USD Consumer Confidence (Mar) 70.0 70.8
The Consumer Confidence released by the Conference Board captures the level of confidence that individuals have in economic activity. A high level of consumer confidence stimulates economic expansion while a low level drives to economic downturn. Generally, a high reading is also positive for the USD, while a low reading is negative.
14:00 USD Richmond Fed Manufacturing Index (Mar) 18 20
The survey including information on shipments, new orders, order backlogs, and inventories conducted by Federal Reserve Bank of Richmond provides information on current activity in the manufacturing sector (mailing 220 business organizations). The industry inflation can be seen from the survey. Generally speaking, a high reading appreciates (or is bullish for) the USD, whereas a low reading is seen as negative (or bearish for) the USD.
16:45 USD Fed’s Bernanke Speech
The Fed Governor Ben Bernanke was born in 1953. He graduated from Harvard University and a Ph.D. in economics in 1979 from the Massachusetts Institute of Technology. In 2006 he became the Chairman of the Federal Reserve System. He gives a press conference as to how the Fed observes the current US economy and the value of USD. His comments may determine a short-term positive or negative trend.
March 26
05.00 P.M GMT
Monday favors a pullback towards 1644-1655.
ANY MOVE ABOVE 1675 on Monday will put the short term bears in trouble.
Look for resistance to be in the 1665-1675 area on Monday.
Long Term=Up (major resistance held the uptrend – Need monthly closes above 1767-1804)
Medium Term=NEUTRAL (Major Resistance 1767 Monthly Close)
Intermediate Term=Down---The North American Winter seasonal correction is about complete
Short Term=Down – short term cycles call for a bottom.
Support and Resistance for Monday
Initial Resistance for 1665-1675 and 2nd tier 1688-1694
Initial Support 1647-1666 and 1637-1641
Outlook for Monday
we got above initial resistance on Friday, but the 1665-1675 area is still the point to exceed before any consideration that the short term cycles have reversed higher. Monday favors 1665-1675 to be first resistance with additional resistance at 1681-1688. First support comes in near 1655 and 1644. Thus 1637-1647 is a price point to watch this week and the 1651-1655 area may provide first support on Monday.
Bottom Line
We’re looking for a pullback on Monday to the 1647-1655 area with 1640-1644 also a potential. If gold can’t get below 1655, the potential could turn to the upside later in the day. We’ll cover it on the 11 am daily email on Monday. Thus---we’re looking for a price low, but a close above 1665 IS A MUST TO BEGIN favoring the upside from a ‘trend’ standpoint. The focus for this week will most likely be Spain debts, as the EURO CRISIS could very well return to focus this week. China and USA data will be looked at closely and there is some growing trade concerns that are developing between the two nations. The further movement of China to eliminate the dollar trade grows, and more and more policies are suggestive that China (step by step, inch by inch) is prepping the Yuan to be a major global currency. A CLOSE ABOVE 1665 – 1675 is needed to neutralize the short term down trend. Let’s see which area wants to give us support on Monday. Let’s remain cautious until we see the above 1665 area.
06:30 EUR French GDP (QoQ) 0.2% 0.2%
Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health.
09:30 GBP Business Investment (QoQ) -5.4% -5.6%
Business Investment measures the change in the total inflation-adjusted value of capital expenditure made by companies in the private sector.
09:30 GBP Current Account -8.4B -15.2B
The Current Account index measures the difference in value between exported and imported goods, services and interest payments during the reported month. The goods portion is the same as the monthly Trade Balance figure. Because foreigners must buy the domestic currency to pay for the nation’s exports the data can have a sizable affect on the GBP.
09:30 GBP GDP (QoQ) -0.2% -0.2%
Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health.
T.B.D. EUR German CPI (MoM) 0.3% 0.7%
The German Consumer Price Index (CPI) measures the changes in the price of goods and services purchased by consumers.
13:30 USD Core Durable Goods Orders (MoM) 1.5% -3.0%
13:30 USD Durable Goods Orders (MoM) 3.0% -3.7%
Core Durable Goods Orders measures the change in the total value of new orders for long lasting manufactured goods, excluding transportation items. Because aircraft orders are very volatile, the core number gives a better gauge of ordering trends. A higher reading indicates increased manufacturing activity. Durable Goods Orders measures the change in the total value of new orders for long lasting manufactured goods, including transportation items.
March 27
04.00 P.M GMT
The gold market overnight managed another new high for the move and in the process the June gold contract reached the levels of March 13th. While the gold market was cheered on by the ongoing prospect of ongoing easing from the US Fed in the wake of comments from the Head of the US Fed yesterday,
it is also possible that gold was seeing some lift this morning from analysts’ predictions overnight of more Chinese easing/stimulus ahead. Another element potentially lending support to the gold market this morning is another downside breakout in the dollar, which reached levels of February 29th in the early Tuesday US trade action.
Apparently the comments from the US Fed yesterday served to lift a host of international equity markets overnight and that clearly left gold with a risk on environment. Gold might have been partially limited by a somewhat disappointing German April consumer sentiment reading from the Gfk overnight. Other issues that might be holding back gold from even more gains this morning is a somewhat bearish gold price forecast from a European bank and news of a large gold discovery in Alaska. However, the gold market also saw a rather lofty upside price projection of $2,000, from a Gold mining executive and that projection was for sometime later this year!
The gold market will likely take some direction from the flow of US economic stats this morning, with Consumer Confidence, a home price survey and a Richmond Fed Manufacturing all due for release. Given initial expectations for the scheduled data, it is possible that the bears might expect to see some benefit in the wake of the US data. However, if the gold market is currently being dominated by ongoing hopes of additional easing from the US Fed, perhaps definitively soft US data this morning will actually serve to lift gold prices later this morning.
Asian stock markets were mixed overnight with Hong Kong shares sharply higher, but Shanghai shares mostly tracking sideways. European stocks were higher overnight, with RBS shares finding definitive upside traction off news of a possible asset sale. US stocks were once again showing only minimally positive early action, as they benefited from the supportive Fed comments in yesterday's trade. The US economic report slate this morning is rather active again today, with Consumer Confidence, Home prices and a Richmond Fed Manufacturing all due out in the Tuesday morning trade.
Price has reached the down trending dotted red line near 1696. With options expiration today gold should trade in the 1696-1705 zone and price will probably remain near 1700 for most of the session.
it is also possible that gold was seeing some lift this morning from analysts’ predictions overnight of more Chinese easing/stimulus ahead. Another element potentially lending support to the gold market this morning is another downside breakout in the dollar, which reached levels of February 29th in the early Tuesday US trade action.
Apparently the comments from the US Fed yesterday served to lift a host of international equity markets overnight and that clearly left gold with a risk on environment. Gold might have been partially limited by a somewhat disappointing German April consumer sentiment reading from the Gfk overnight. Other issues that might be holding back gold from even more gains this morning is a somewhat bearish gold price forecast from a European bank and news of a large gold discovery in Alaska. However, the gold market also saw a rather lofty upside price projection of $2,000, from a Gold mining executive and that projection was for sometime later this year!
The gold market will likely take some direction from the flow of US economic stats this morning, with Consumer Confidence, a home price survey and a Richmond Fed Manufacturing all due for release. Given initial expectations for the scheduled data, it is possible that the bears might expect to see some benefit in the wake of the US data. However, if the gold market is currently being dominated by ongoing hopes of additional easing from the US Fed, perhaps definitively soft US data this morning will actually serve to lift gold prices later this morning.
Asian stock markets were mixed overnight with Hong Kong shares sharply higher, but Shanghai shares mostly tracking sideways. European stocks were higher overnight, with RBS shares finding definitive upside traction off news of a possible asset sale. US stocks were once again showing only minimally positive early action, as they benefited from the supportive Fed comments in yesterday's trade. The US economic report slate this morning is rather active again today, with Consumer Confidence, Home prices and a Richmond Fed Manufacturing all due out in the Tuesday morning trade.
Price has reached the down trending dotted red line near 1696. With options expiration today gold should trade in the 1696-1705 zone and price will probably remain near 1700 for most of the session.
Support for the remainder of the day is 1681-1690 and resistance 1696-1701.
10.00 A.M GMT
With options expiration tomorrow, odds favor we see the 1700-1705 on the upside and 1677-1685 on the downside.
Long Term=Up (major resistance held the uptrend – Need monthly closes above 1767-1804)
Medium Term=NEUTRAL (Major Resistance 1767 Monthly Close)
Intermediate Term=Down---The North American Winter seasonal correction is about complete
Short Term=up – support is now 1644-1650
Support and Resistance for Monday
Initial Resistance for 1692-1705 and 2nd tier 1712-1716
Initial Support 1667-1677 and 1651-1655
Tuesday favors 1693-1704 to be first resistance. First support comes in near 1655-1665. There is also minor support at 1677-1681.
The option boys will most likely be running it up there on Tuesday and we’ll most likely get a push higher into Wednesday.
00.30 A.M GMT
Gold skyrocketed up 26.95 to trade at 1691.75. Early last week, as prices fell, and investors began jumping back into the markets, we predicted that Gold might have one more shot at the 1700.00 level before collapsing. Gold should now begin to fall, after the markets recover from Mr. Bernanke’s speech.
His mere mention of the words monetary policy or monetary easing sent the dollar falling and gold climbing.
His mere mention of the words monetary policy or monetary easing sent the dollar falling and gold climbing.
Gold began to climb after U.S. Federal Reserve Chairman Ben Bernanke said the central bank’s ultra-low interest rate policy can help the labor market, but warned that faster economic growth was crucial to ensuring further recovery.
The improvement in the labor market since last fall may only be a reversal of large layoffs during the recession, and further improvement may depend on faster economic growth.
Bernanke’s speech “reiterated themes that Federal Reserve policy makers have used to justify policy accommodation since last summer,” wrote economists at Nomura Global Economics, who said the arguments used by Bernanke — largely pointing to weakness in the labor market despite some recent signs of improvement — support further policy action.
Mr. Bernanke is scheduled to speak again on Tuesday, we will see where Gold trades after his address tomorrow.
Economic Events Scheduled for March 27, 2012
All Day G7 Meeting
The G7 meeting is the meeting of the finance ministers from the group of seven industrialized nations that are the United States, Japan, Germany, France, United Kingdom, Italy and Canada. The meeting takes place several times a year to discuss economic policy. Traders should pay close attention to this event as it might bring a new dimension to the markets.
07:00 EUR GfK German Consumer Climate 6.2 6.0
The Gfk German Consumer Climate Index measures the level of consumer confidence in economic activity. The data is compiled from a survey of about 2,000 consumers which asks respondents to rate the relative level of past and future economic conditions.
11:00 GBP CBI Distributive Trades Survey -4 -2
The Confederation of British Industry (CBI) Distributive Trades Survey (DTS) measures the health of the retail sector. The reading is compiled from a survey covering 20,000 firms responsible for 40% of employment in retailing. It includes measures of sales activity across the distributive trades. It is a leading indicator of consumer spending. The figure is the difference between the percentage of retailers reporting an increase in sales and those reporting a decrease.
13:00 USD S&P/Case-Shiller Home Price Indices -3.8% -4.0%
The S&P/Case-Shiller Home Price Indices released by the Standard & Poor’s examines changes in the value of the residential real estate market in 20 regions across the US. This report serves as an indicator for the health of the US housing market. Generally speaking, a high reading is seen as positive (or bullish) for the USD, while a low reading is seen as negative, or bearish.
14:00 USD Consumer Confidence (Mar) 70.0 70.8
The Consumer Confidence released by the Conference Board captures the level of confidence that individuals have in economic activity. A high level of consumer confidence stimulates economic expansion while a low level drives to economic downturn. Generally, a high reading is also positive for the USD, while a low reading is negative.
14:00 USD Richmond Fed Manufacturing Index (Mar) 18 20
The survey including information on shipments, new orders, order backlogs, and inventories conducted by Federal Reserve Bank of Richmond provides information on current activity in the manufacturing sector (mailing 220 business organizations). The industry inflation can be seen from the survey. Generally speaking, a high reading appreciates (or is bullish for) the USD, whereas a low reading is seen as negative (or bearish for) the USD.
16:45 USD Fed’s Bernanke Speech
The Fed Governor Ben Bernanke was born in 1953. He graduated from Harvard University and a Ph.D. in economics in 1979 from the Massachusetts Institute of Technology. In 2006 he became the Chairman of the Federal Reserve System. He gives a press conference as to how the Fed observes the current US economy and the value of USD. His comments may determine a short-term positive or negative trend.
March 26
05.00 P.M GMT
Today’s ‘shot’ comes from none other than the Fed chief Bernanke. Apparently he was doing a speech today to some organization and all that he said was that the economy was still weaker than what was needed to increase employment stats in USA. And basically that was all that he said---and stocks and commodities embarked on a 30 minute rally that took gold from 1655 to 1680.
Further discussions last night was The price low on the 22nd at 1628. The 22nd was the ideal day for a short term trend change.
Thus it now looks like an important price low could be in place for the metals. We say could be because the news itself is not bullish enough in itself to sustain the new move. However, whether these things happen by coincidence or not, it comes right in line with the trends we’re watching for. The key at this point is going to be IF GOLD CAN NOW HOLD THIS CURRENT move above the key 1665 area.
08.00 A.M GMTFurther discussions last night was The price low on the 22nd at 1628. The 22nd was the ideal day for a short term trend change.
Thus it now looks like an important price low could be in place for the metals. We say could be because the news itself is not bullish enough in itself to sustain the new move. However, whether these things happen by coincidence or not, it comes right in line with the trends we’re watching for. The key at this point is going to be IF GOLD CAN NOW HOLD THIS CURRENT move above the key 1665 area.
In summary -- it looks like the short term trends are now in favor of the upside. What we want to SEE is gold REMAIN ABOVE 1655-1660 on a closing basis.
On the upside, we need to move and close above the 1688-1692 price area.
That would favor a move to 1705-1712 as the next price point.
On the upside, we need to move and close above the 1688-1692 price area.
That would favor a move to 1705-1712 as the next price point.
Monday favors a pullback towards 1644-1655.
ANY MOVE ABOVE 1675 on Monday will put the short term bears in trouble.
Look for resistance to be in the 1665-1675 area on Monday.
Long Term=Up (major resistance held the uptrend – Need monthly closes above 1767-1804)
Medium Term=NEUTRAL (Major Resistance 1767 Monthly Close)
Intermediate Term=Down---The North American Winter seasonal correction is about complete
Short Term=Down – short term cycles call for a bottom.
Support and Resistance for Monday
Initial Resistance for 1665-1675 and 2nd tier 1688-1694
Initial Support 1647-1666 and 1637-1641
Outlook for Monday
The ideal target date of March 22nd as the low for the month we’ve been tracking so far is a direct hit as the 1628 low was that day. But we still need to close above a KEY 1665 PRICE POINT BEFORE we can consider the upside is in play. If the short term cycles are kicking in, we should exceed that price point later this week. A conservative approach to short term trades would suggest we wait for a close above 1665 before taking long positions, but the cost of course is the stop has to be much deeper. The North American Seasonal downtrend is also due to end AND IS THE INTERMEDIATE TERM trend. So there’s a lot to favor a price low. However, since we have long term cycles due here, we still need to be cautious. GOLD SENTIMENT IS AT AN EXTREME –but the thing we haven’t seen is the “cheerleaders” turning bearish. Thus, while we may rally here, the longer term CORRECTION we’ve been in since August is still in play at this time. With the sentiment this extreme, it does favor a low is close by. One more dip would be perfect for a pattern play---but with the cycle window closing on the short term after today’s trade, if the ‘control boyz’ can’t hold 1665-1670 then the upside will gain the favor.
What Next?
The ideal target date of March 22nd as the low for the month we’ve been tracking so far is a direct hit as the 1628 low was that day. But we still need to close above a KEY 1665 PRICE POINT BEFORE we can consider the upside is in play. If the short term cycles are kicking in, we should exceed that price point later this week. A conservative approach to short term trades would suggest we wait for a close above 1665 before taking long positions, but the cost of course is the stop has to be much deeper. The North American Seasonal downtrend is also due to end AND IS THE INTERMEDIATE TERM trend. So there’s a lot to favor a price low. However, since we have long term cycles due here, we still need to be cautious. GOLD SENTIMENT IS AT AN EXTREME –but the thing we haven’t seen is the “cheerleaders” turning bearish. Thus, while we may rally here, the longer term CORRECTION we’ve been in since August is still in play at this time. With the sentiment this extreme, it does favor a low is close by.
The chart below shows the two black arrows pointing to the red dotted trend lines of support and resistance. The red mini line above price is now all the way up to the 1675 area and now weekly resistance. THAT LOWER GREEN HIGHLIGHT is the first support on Monday to watch at 1647-1655 area. That lower down trending red dotted line is still main support. Thus the 1612-1624 area is support should price fall hard.
The chart below shows the two black arrows pointing to the red dotted trend lines of support and resistance. The red mini line above price is now all the way up to the 1675 area and now weekly resistance. THAT LOWER GREEN HIGHLIGHT is the first support on Monday to watch at 1647-1655 area. That lower down trending red dotted line is still main support. Thus the 1612-1624 area is support should price fall hard.
Bottom Line
00.00 A.M GMT
Currently uptrend should end around 1669 area.
A correction down to below 1647 is expected.
GOLD finished last week flat after continuing on from Thursday's rebound on Friday night to finish the day around 15 dollars up at 1661, as the US dollar headed lower. As we expected, gold has showcased short term upward momentum after a major false break on Thursday, forcing weak gold shorts to exit. There hasn't been much on the news front last Friday, a reconsideration of Thursday's weak Chinese and European PMI is probably what drove the euro up within its trading range thus pressuring the USD. Again, the rebound in gold could still be sustained but aggressive traders may short the precious metal at current price levels now that it is close to the upper boundary of the trading range, with a strict stop loss around 1670 and targeting 1630 which is around last Thursday's low.
Supports / Resistances
Res 2 1,680.8700
Ex-High 1,666.3500
Res 1 1,671.3100
Pivot 1,656.7900
Sup 1 1,647.2300
Ex-Low 1,642.2800
Sup 2 1,632.7200
Government Bond Auctions (this week)
Mar 26 09:10 Norway Nok 3.0bn NST 474 3.75% May 2021 Bond
Mar 26 10:30 Germany Eur 3.0bn new Mar 2013 Bubill
Mar 26 15:30 Italy Details BTP/CCTeu auction on Mar 29
Mar 27 09:10 Italy CTZ/BTPei auction
Mar 27 08:30 Spain 3 & 6M T-bill auction
Mar 27 17:00 US Auctions 2Y Notes
Mar 28 09:10 Italy BOT auction
Mar 28 17:00 US Auctions 3Y Notes
Mar 29 09:10 Italy BTP/CCTeu auction
Mar 29 17:00 US Auctions 7Y Notes
YOU SHOULD NOT TAKE ANY MATERIAL posted on this BLOG AS RECOMMENDATIONS TO BUY OR SELL GOLD OR ANY OTHER INVESTMENT VEHICLE LISTED.
Do your own due diligence.
No one knows tomorrow's price or circumstance.
I intend to portray my thoughts and ideas on the subject which may s be used as a tool for the reader.
I do not accept responsibility for being incorrect in my speculations on market trend.
King Regards.
