Tronlink Wallet Airdrop: GOLD TREND April 9

April 13
04.30 PM GMT
London Gold Fix $1,670.50 +15.00

After a low to high swing this week of almost $50 an oz, the June gold contract might have entered the action today a touch overbought technically. Therefore some of the weaker action this morning is probably the result of profit-taking, that in turn was probably brought on by less than stellar Chinese growth readings and with the increasing concern in EUROPE with the Spain Situation and the overall liquidity concern in Europe. Their Equity markets took a major hit on Friday.

With the Chinese data undermining the Euro and lifting the dollar, it isn't surprising to see gold pressured somewhat by adverse dollarmarket action. However, some Asian equity markets were able to spin the Chinese news into a positive, by suggesting that the data might clear the way for Chinese easing ahead. On the other hand, gold traders will probably be put off balance by weakness in a host of commodity markets this morning, as macro economic sentiment has returned to a somewhat skeptical posture in the wake of the rise in US claims yesterday, an apparent on-hold stance by the US Fed this week and perhaps because of some residual concern toward Spanish Financial institutions overnight.

On the plus side, gold might draft some minimal support from an upward revision in a gold price forecast from a European brokerage firm. On the minus side, the prospect of muted US inflation readings probably won't do much to alter the early weaker bias in gold prices, especially if US equities remain on Wall Street.

Asian equity markets were somewhat put off by softer than expected Chinese GDP readings but many markets in that region managed to recover off the idea that the softer Chinese data might clear the way for more Chinese stimulus ahead. European markets were weaker to start, as some investors came away from the Chinese readings disappointed in near term prospects. Record borrowing by Spanish banks in the month of March was another development that seemed to prompt some fresh contagion concerns, especially since that news came in the wake of the Chinese GDP disappointment. Early in the US Friday session, share prices were weaker in what would appear to be a precursor to a risk off day. The US economic report slate did not cause much of a change in the early track of sentiment as the CPI report follows the PPI report release from yesterday and there doesn't look to be much of a surprise due out from the inflation front. There will also be a consumer sentiment report and a couple Fed speeches but the Fed this week seemed to make sure the markets realized that Fed policy could swing in either direction depending on what was dictated by the US economy.

Going to the gold chart

The chart below shows the move since the low near 1600 and the move back up this week. The one concern I have about this push back up is that the pattern is choppy and overlapping. Notice how impulsive the pattern was on the downside with strength. The choppy move back up keeps the potential that the move is only a bounce and not the start of a new trend. Choppy trends are usually counter moves. THUS the real test is whether gold is going to be able to close above the 1681-1688 area. IF IT CAN DO THAT – then the advantage will favor higher into next week and potentially towards 1725-1750.

Support is the 1663-1665 area where the 2nd FIB retrace levels is on the chart just below today’s low with additional support at 1650. RESISTANCE on a daily basis is that 1681 – 1688 area.

IN SUMMARY – we think the biggie for today is the situation in Spain and the continuing DEBT concerns.

The key today is what gold will do after the Europe close.

08.30 AM GMT
Long Term=Up (major resistance held the uptrend – Need monthly closes above 1767-1804)
Medium Term=NEUTRAL (Major Resistance 1767 Monthly Close) KEY SUPPORT AT (1579-1612) has held. The 1700 area at the 34 week moving average is the next key target.
Intermediate Term=NEUTRAL (the downtrend looks complete and is ready to turn bullish)
Short Term= UP (The downtrend has been neutralized and as long as we remain above 1640, the short term trend is up)
Support and Resistance for Thursday
Initial Resistance for 1682-1692 and 2nd tier 1701-1706
Initial Support 1655-1665 and 1638-1644

Recap

Gold moved higher on Thursday, as metals and stocks were not phased by slightly higher-than-expected jobless claims and a less-inflationary than expected PPI. Gold’s move was in line with a stronger Euro and a lower Dollar. China’s 1st Quarter-GDP is being released tomorrow morning, and the rally was most likely in line with speculation that the report will be good. A positive Australian employment report added to the upside moves in the commodities and stock markets.

Gold made rallied right up to the weekly price resistance of 1681 we’ve been using exactly as the price high and closed at a key daily price point we’ve also been watching at 1675. The big battle we discussed yesterday was won by the bulls and a Friday weekly close above 1681 would favor higher prices into the 20th of the month.

Seasonal

The seasonal looks to have taken hold. We thought this was the case the week of March 22nd when gold reached the 1681 area and turned back down after the FOMC Fed statement about not supporting additional QE asset buying. Now once again gold has reached the 1681 area as the Thursday close COMEX close was 1680.50 on the June contract and the 5PM New York after hours close was at 1675.50 – two key numbers we’re watching.

In summary – it looks like the seasonal trend has arrived and a weekly close above 1681 on Friday and the 1700 area next week will favor higher into Mid May.

Short Term – Short Term Cycles

Thursday’s action brings the new BULLISH cycle view very close to being confirmed as the new view with the price low being established on the dominant blue cycle. The price move above the channel must be watched to confirm. The ‘control boyz’ know the channel game and many times they will push price just enough above the channel line to trigger stops and then push price lower and leave new longs with a buy right at the top of the channel.

For now, as long as we hold the 1650 area on a closing basis, this cycle has the advantage. First support is the upper blue dotted trend line in the 1655-1660 area on a closing basis. The next short term cycle is not due until April 20th (plus or minus 72 hours). Pullback support should be the in the 1660-1665 area on Friday. First resistance is the 1680-1688 area on Friday. If we get a close above 1692 then this cycle is favored to be in play.

What Next?

Last night we discussed the potential of either an inside day or a higher price towards the 1672-1676 area and gave the upside as having a slight edge. Price got as high as 1680 and closed at 1675 on the Globex 5PM EST close.

The battle for control of the market was won by the bulls and any close above 1681 puts them in control of the short term and favors a move towards 1705-1725 for next week. Price pullbacks should hold the 1658-1666 area on Friday and the pressure will remain on the upside.

This TICK chart of gold shows the pattern since the lows of last week. That chop of Tuesday and Wednesday was for control of the short term trend, and the bulls seem to have won the battle for now. We discussed the upside had a slight advantage and today’s rally confirms it. Pullback support is the 1660-1665 area on Friday at the first level and the 1655 area is second level. The one thing we don’t like is the choppy and overlapping condition of this rally since last week. The down move on the chart was ‘impulsive’ and strong and that usually defines the main trend. This rally back up has been choppy and overlapping and that is usually a sign of a counter trend move. Not always, but it is a concern and is the one thing that we are a bit uncomfortable with on this move back up. It should be the other way around. It is not often that this type of pattern ends up being a sustainable run. When it does sustain, the move MORPHS and turns impulsive. For the moment, this is the one thing that has me concerned as to whether we can sustain this move up.

Bottom Line

The market moves into Friday with the bulls in charge but the potential that the high for the week in place is a strong consideration as the 1681-1684 area is where weekly reversals are and where the last high point took place.

There are a lot of factors that favor a price rally for April---the seasonal, the coming India festivals, and the strong support areas gold has tested. We got the move out of the downtrend channel and the next resistance is the first green area on the chart below. Odds favor a move to the next dotted trend line at the 1710-1730 area as the most likely outcome IF WE CAN CLOSE ABOVE 1681-1688. Friday can be a consolidation day but barring pullbacks the upside has the advantage at the moment.

April 12
04.00 PM GMT

With acceptable auction results from Italy this morning, somewhat positive psychology in China overnight and generally supportive US corporate news flow, commodities like gold caught some underpin on the charts with gold holding 1650 and silver 31.25 and staging a rally along with stocks on higher claims than expected.

The gold market also saw news of another decline in South African gold output in February versus year ago levels. In fact, gold production on a year over year basis declined in excess of 11% and that continues a trend of falling production from that area. A flurry of Fed speeches today was opposite of what Bernanke said last week, with supportive dialogue.

Asian equity markets were higher overnight, with the trade still tossing around the idea of upcoming Chinese easing, but there also seemed to be some hope that Chinese GDP readings tonight would come in positive. The European markets were softer, as they marked time ahead of Italian debt auction results, but it also seemed as if fears of slowing in the Euro zone were still being discussed. On the other hand, expectations of ongoing ECB bond buying activity and an eventual acceptable auction yield from Italy, should tamp down European economic concerns temporarily. At least in the early US trade, equities are higher, despite a not so great claims number.

Going to the gold Chart

Today’s break out above 1665 and subsequent rally to 1675 has gold on the upside edge of favoring higher prices. The last high at 1685 still needs to be exceeded but gold’s move on Thursday lays the groundwork for that event to take place. It’s possible we are making the highs for the week here, and a pullback and consolidation will take place for the remainder of the week. Any pullback to the 1665 area that holds should favor higher prices.

Resistance for the remainder of the day is the 1675-1681 area and support is now 1662-1665. In summary, it looks like the short term cycles are favoring higher and the potential for gold to rally next week has increased significantly.

Look for support on pullbacks at 1660-1665.

CLOSES ABOVE 1675-1681 would open the potential for higher prices into next week. This area is the upper end of the trading range of the last significant high on the chart. Price still needs to move above that area to clear the way, but today’s up move has to be favored as an important turn up.

Lets see if we can close above 1675.

12.00 AM GMT

The metal settled above the main resistance of the downside movement and also above 23.6% Fibonacci correction of the downside movement, which started at 1790.00 and ended at the bottom of 1612.00. This correction at 1653.00 became a strong support level, while consolidation above this level might trigger the continuity of the upside move as the metal attempts to form the CD leg of the suggested harmonic pattern. A breach of 1624.00 negates our positive outlook.

The trading range for today is among the key support at 1608.00 and key resistance now at 1700.00.

Our opinion is buying gold around 1650.00, targeting 1681.00 and stop lose below 1638.00

04.00 AM GMT
The tight range today confirms the market itself is uncertain and there's a big battle taking place at 1655-1665 between the bulls and the bears.
Long Term=Up (major resistance held the uptrend – Need monthly closes above 1767-1804)
Medium Term=NEUTRAL (Major Resistance 1767 Monthly Close) AT KEY SUPPORT THAT NEEDS TO HOLD on the weekly chart (1579-1612)
Intermediate Term=Down---We await the spring seasonal to kick in, the ‘trend’ has not turned up yet on an intermediate term basis.
Short Term= Down– Short term cycles have a mixed outlook. Close above 1665 neutralizes down trend.
Support and Resistance for Thursday
Initial Resistance for 1662-1672 and 2nd tier 1681-1688
Initial Support 1638-1644 and 1622-1628

Recap

Gold traded in a very tight range on Wednesday and an inside day (lower high/Higher low) played out for the day. Stocks rebounded also from the big sell off of late. The US DOLLAR is at the 80 level on the index and at a major long term point on the chart. The key level we continue to watch is the 1665-1675 area for the short term. We're watching the short term cycles as we have an inversion potential. The tight range today confirms the market itself is uncertain and there's a big battle taking place at 1655-1665 between the bulls and the bears. And that's the bottom line for Thursday--whether we can get above 1665-1675.

What Next?

Last night we discussed that since we hit the dotted trend line on Tuesday that Wednesday could be an “inside day” where price would be lower than the Tuesday high and higher than the low and that is exactly what we got. We also mentioned at 1653-1655 was a minor support to watch for and the low for the day was 1653. The 1644 and 1653 areas were mentioned as the two most likely spots for a Wednesday low. It’s the same for Thursday. 1651-1655 is one spot and 1638-1644 is the other for support on a pullback. On the upside the 1662-1667 or the 1672-1676 is the two most likely high points. We think Thursday one of two potentials. The first is that we get yet another inside day and the 2nd is that we get a price high at one of the two points we mentioned above..

This TICK chart of gold shows the pattern since the lows of last week. The last 48 hours is a battle for CONTROL of the market. The amount of shorting or selling on the bid has been of huge quantities on the FOREX market. Note how it has happened right at our resistance point of 1665. Whichever way we break out of this range will favor the next move. The fact that they have shorted a lot and not moved price down tends to favor the breakout will be higher. If we start moving below 1650 on Thursday it will begin to favor lower. Until we break out of this area, we can still go either way. The upside has a slight edge but nothing definite.

Let’s take it one step further. This is the action we’ve seen for control of the market. Look at the bottom of the chart. OBV (on balance volume) measures the amount of trade contracts on the bid and ask and then subtracts. This shows that the “control boyz’ shorted all day (sold on the bid) and they were not able to bring gold down. At some point, either the longs will give up and they will start selling or the shorts will have to start hitting the BID (which will make OBV start going up). For today, the bulls absorbed all the selling. Until we break out of this range price can still move in either direction. The odds favor it will resolve to the upside, but they are not big enough odds for me to trade it just yet.

Bottom Line
The market moves into Thursday with the potential to still go either way.

There are a lot of factors that favor a price rally for April---the seasonal, the coming India festivals, and the strong support areas gold has tested. What we need to see now is for to price get out of the red dotted downtrend channel on the chart below. IF we do, we should see a rally to the 1700 area towards the next dotted trend line.

The chart shows the downtrend is still intact and still within the downtrend as defined by the red dotted down trend lines. Until then, we’re still in a downtrend and that also has to be respected. Any move on Thursday above the DOTTED TREND LINE at the 1663-1668 area will favor higher. THAT’S THE SPOT TO WATCH ON THURSDAY. IF we fail this dotted trend line then the downside has a lot of room inside this channel so this is the POINT traders want to FOCUS ON. IF we break above the dotted trend line the potential for a strong up move will be in play, but if we don’t there’s just as much downside possible. Any way we look at it the chart still tells us we are in a downtrend until we break that first dotted line. IF we can’t get above 1665-1673 the trend will resolve to the downside one more time.

April 11
04.00 PM GMT

SUPPORT is currently the 1655-1660 area and

resistance is the 1665-1670.
RIGHT NOW – THEY ARE SELLING like mad in order to try and stop the upside and they still can do it. This is the BIGGEST BATTLE I’ve seen in quite a while. If the bears lose 1667, it will favor a higher finish.

Last night’s website update listed 1662-1672 as resistance and the high so far today has been 1663. Support was listed at 1638-1644 and the low so far today is 1653.
London Gold Fix $1,654.00 +9.25

At least in the early going today, the US equity market and many commodity prices weren't overtly undermined by what seemed to be a very wide spread geological event overnight.

There were reported gains in Vietnam stocks after a series of rate cuts in that country and perhaps the promise of global easing will be given more credence in the wake of the overnight events. However, the gold market has already seen some recent lift, off the "hope" of more easing from the US, but it did not seem as if there was that much hope of assistance beyond the US Fed watch.
Certainly residual concern toward European debt is a tempering element this morning and the positive earnings news from Alcoa yesterday afternoon might need to be backed up by other favorable earnings reports for the US equity markets to fully arrest the recent pattern of weakness in US equity prices. While some players are attempting to talk up gold as a safe haven instrument again, that track of thinking might be difficult to sustain, as gold's commodity market standing has been a dominating focus recently.
News that might provide a slight undermine for gold prices today, is evidence of higher gold production from some North American mines, but news that gold flow from Hong Kong to mainland China was up sharply on a month over month basis might mean that overall supply and demand news overnight was mostly supportive.

In the action today, the gold market should continue to take direction from the FED as it will also parse the words early this morning closely and then again intensely early this afternoon for any fresh policy hints.

Asian equity markets were higher overnight, with the markets speculating on an upcoming Chinese RRR reduction.
The European markets tried to stabilize overnight but that might have simply been a reaction to a recent concentrated oversold status. However, a poor Italian auction result overnight might provide some late pressure to European shares. It should also be noted that a German auction wasn't fully covered overnight, but yields on that instrument were still very low and that might reduce the concern from the lack of auction demand. At least in the early US trade equities were trading moderately higher, perhaps because of a supportive earnings season kick off from Alcoa yesterday afternoon. From the US scheduled report front today, the markets will see a weekly loan application , US Import/Export prices, a 10 Year US auction result and the release of the Fed's Beige book. There will also be speech from the Fed's Lockhart early in the trading session today. OIL inventories will be released at 10:30 AM New York Time.

Gold Going to the Chart

The gold market has been in a super tight range over the past 24 hours and a huge fight is going on. THE SHORTS have been trying and trying to knock down gold but every time they do so far – gold keeps absorbing the sales at the bids. IF GOLD can hurdle the 1665-1666 area ---- additional buying would be favored to come into the market.

SUPPORT is currently the 1655-1660 area and resistance is the 1665-1670.

With the action the way it is so far ---- it looks like the shorts are getting ready to lose the battle today. THEY have tried all morning to force a sell-off and gold refuses to give up more than just a few dollars.

TODAY IS A KEY DAY

as we’ve already had a three day bounce from last weeks low. A NEW HIGH above 1667 would tilt the odds to the upside into Thursday. THE OTHER Side of the coin is that if the shorts can hold gold below 1665-1667 --- then they will still have a slight edge. In summary, it has been 24 hours the fight has been going on for control. IF price moves above 1667, it would favor the bulls for the remainder of the day and it would add to the potential that the LOWS for April may have been witnessed when gold hit 1612 last week. It can still go either way ---but I can tell you the SHORTS are in trouble so far as everything is getting absorbed. While it may change --- right now the upside is favored. The last ten minutes has a lot of selling as they are doing all they can to stop price from moving above 1667. IF WE MOVE above 1667, it will favor a move towards 1675-1681. BUT we must move above 1667 in order to favor higher.

RIGHT NOW – THEY ARE SELLING like mad in order to try and stop the upside and they still can do it. This is the BIGGEST BATTLE I’ve seen in quite a while. If the bears lose 1667, it will favor a higher finish.

A new high above 1665 will favor a peak on Thursday and a pullback to Friday morning. It can go either way here – but the shorts are shorting a lot to keep it under 1665.
Resistance 1665-1667 and support 1651-1654. THE SHORTS ARE DOING ALL THEY CAN TO STOP IT – and they just keep selling and selling the BID – while they might be successful --- and trip up to the upside and they could be in big trouble. – ABOVE 1667 and it should be higher --- but as long as they hold that – they can stem the buying.

04.00 AM GMT

Wednesday favors first resistance at 1662-1672

and first support is the 1638-1644 area.

Long Term=Up (major resistance held the uptrend – Need monthly closes above 1767-1804)
Medium Term=NEUTRAL (Major Resistance 1767 Monthly Close) AT KEY SUPPORT THAT NEEDS TO HOLD on the weekly chart (1579-1612)
Intermediate Term=Down---We await the spring seasonal to kick in, the ‘trend’ has not turned up yet on an intermediate term basis.
Short Term= Down– Short term cycles have a mixed outlook. Close above 1665 neutralizes down trend.
Support and Resistance for Wednesday
Initial Resistance for 1662-1672 and 2nd tier 1681-1688
Initial Support 1638-1644 and 1622-1628

Recap

The following excerpt was written by Austin Kiddle:

From this year's peak on 28 February at $1,792.7 gold price has declined 8% though it is still up about 5.5% in 2012. The dollar index rose 1.1% while the MSCI World (developed) index declined 1.7% last week.
Many market participants have attributed the drop in gold price since end-February to a diminishing chance that the U.S. Fed will adopt QE3. The rally in risky assets such as global equities due to better economic growth number, albeit lopsided from the U.S., led some to reduce safe haven bets such as gold.
A surprisingly soft U.S. employment data last Friday, an increase in payrolls of 120,000, reminds investors that U.S. labor market may not be strong enough to sustain economic momentum on its own without further monetary stimulus from the Fed.
The rebirth of uncertainty takes place when the Spanish 10-year bond yield surged 40 basis points last week as investors were expecting Spain, like Greece, Ireland and Portugal, would need to request for international aid. Spain is the most closely-watched country as the bellwether for Europe's sovereign debt crisis. The higher than expected China's March CPI number of 3.6%, compared to median economists' forecast of 3.4%, may bring more uncertainty to China's monetary easing.
CFTC data confirms that the net speculators' positions on gold declined from this year's peak of 221,542 at end-February to 149,599 as of the week ending 3 April. The technical position for gold appears better as some of the "weak longs" have been removed from the market.
Though too early to tell, the re-opening of the Indian Jewelers for business last Saturday should bring out the pent-up demand. The Indian consumers will gear up for the Akshaya Tritiya festival on 24 April as well as the wedding season. Physical demand especially from India and China is the key supporting factor for investment demand for gold.
This week Q1 U.S. earnings season will kick-start which should influence the risk sentiment as well as the U.S. dollar direction. Stay tuned.

Kitco reports:

Physical demand for gold is expected to pick up again now that Indian jewelry shops have ended a strike, although it remains to be seen how strong this demand will be and whether the protests will resume next month, analysts said. A majority of India’s jewelers closed their shops for roughly three weeks to protest a doubling of the import tax on gold from 2% to 4% and introduction of an excise tax of 1% on unbranded gold jewelry. Jewelers reopened late last week when Finance Minister Pranab Mukherjee reportedly offered assurances he would consider a rollback of the excise duty.
Jewelers across India witnessed good footfall on Monday when they reopened their shops after a 21-day strike. They expect a 10-15% increase over and above the normal demand in the next few days as the summer wedding season, which along with festivals whets the country's appetite for gold, begins this week.
Spanish banks may need more capital: Reuters noted that Bank of Spain Miguel Angel Fernandez Ordonez said on Tuesday at a conference in Madrid that Spanish banks could need more capital if economic conditions continue to deteriorate. He added that a strong recovery is unlikely in the short-term. Recall that Spain's plans to address the problems in the banking sector call for lenders to set aside €50B of provisions (without any state support) against real-estate assets (Spanish banks have ~€175B in troubled real-estate assets on their books). Separately, Bloomberg noted that Ordonez said the ECB council has never discussed the possibility of Spain needing a bailout.

Outlook for Wednesday

Mid-Week Wednesday usually favors either a high or low point for the week and with today’s action we favor a test of 1662-1672. However, with three days up, it is possible that Tuesday was the high and an inside range day could play out where the high would be just a bit lower and the low higher. If Wednesday does make a new high, it would also favor that Thursday would also. If we do make a new high on Wednesday, the 1672-1675 area would be a candidate for a daily high.

What Next?

We got our test of 1655-1665 with the 1664 high on Tuesday. Wednesday’s have a high propensity of producing highs so the potential for gold to trade to the 1665-1675 area is in play. Price doesn’t have to go to that level but it has the potential. The 1638-1644 area looks like good support for Wednesday and a pullback to that area could provide the lows for the day.

Wednesday favors first resistance at 1662-1672 and first support is the 1638-1644 area. Should price move below 1630, it would bring the downside action potential back into play.

While the potential to make a new high on Wednesday has higher odds than not, it also is not an absolute. Tuesday’s high completes a three day bounce and therefore, it is possible that we saw the high today and that Wednesday will be an ‘inside day’ where the low will not be as low but neither will the high. Price favors a range in the 1640-1663 zone. Watch the 1653-1655 area as minor support ALSO on the first pullback. The 1644 area – and the 1653 area are the two best potential points for a low on Wednesday if the price move from today is to continue.

Bottom Line

The market still has both sides open as to the outcome of the short term cycles. While not pleasing, that is what the market has offered up and that is what we have to work with. With the third day up on Tuesday, if we’re still in a downtrend price should not close above 1675 and a few days of pullback should come back in play. If price does close above 1675, then we’ll have to begin to favor the upside as having the edge. Right now, it can still go either way. NONE of the downtrend lines have been exceeded and so the overall trend has not officially turned up as of yet.

There are a lot of factors that favor a price rally for April---the seasonal, the coming India festivals, and the strong support areas gold has tested. What we need to see now is the price get out of the red dotted downtrend channel.

The chart shows the downtrend is still intact and still within the downtrend as defined by the red dotted down trend lines. Until then, we’re still in a downtrend and that also has to be respected. An uptrend would require a move above that 1675-1685 green area on the chart---the same one we’ve been using for the past few weeks.

As long as we remain below that dotted trend line on a closing basis, the downside still has the advantage.

April 10
05.00 PM GMT

Gold has filled the gap from the Sunday night open and as you can see there is a downtrending line of support at the 1635 area in gold. This area is the most likely place to look for the market to attempt to make a low today.
Additional support is the 1625-1628 area.
Resistance remains the 1655-1660 area and there is still the potential that gold is going to try to move up towards that area into the Wednesday trade. With that said, Tuesday’s have not been good to gold over the last three weeks. During bull trends, Tuesday is usually one of the best days of the week. Thus today’s action will give some clues as to whether we’re in a short term bounce trend or whether we’ve still got some downside to deal with.
Support for the remainder of the day is the 1628-1633 area and resistance is going to be the 1640-1644 area and the 1655-1660 area.
In summary, the trends are still down in the metals and if there is no bounce this afternoon, the Wednesday could again provide a lower price point under today’s low. Now that the GAP is filled, if gold doesn’t react higher then the current channel line on the chart will become resistance instead of support. Once Europe closes we might see a rebound as traders are probably getting out of positions now that the market has reopened from Easter holidy.

07.00 AM GMT
Long Term=Up (major resistance held the uptrend – Need monthly closes above 1767-1804)
Medium Term=NEUTRAL (Major Resistance 1767 Monthly Close) AT KEY SUPPORT THAT NEEDS TO HOLD on the weekly chart (1579-1612)
Intermediate Term=Down---We await the spring seasonal to kick in, the ‘trend’ has not turned up yet on an intermediate term basis.
Short Term= Down– Short term cycles have a mixed outlook. Close above 1665 neutralizes down trend.
Support and Resistance for Tuesday
Initial Resistance for 1655-1665 and 2nd tier 1673-1678
Initial Support 1635-1641 and 1621-1626

Recap

The stock market took it on the chin on Monday from the bad job data of last Friday. Of major note was that gold did not REACT on the news but is in a bounce from the lows of last Thursday. Silver also held the lows from last week and is building a base in the 31.40-31.60 area at the moment. The potential that gold has made a low comes down to the action we’ll see at the Tuesday resistance of 1655-1665. Resistance will be the strongest near 1655-1660. Any retest of the lows that provides support and starts moving back up will favor that a rally into April 20th will gain favor.

Outlook for Tuesday

The outlook for a move to 1645-1655 on Monday played out as the high was 1649. Tuesday favors a test of 1655-1665 (we favor around 1558-1562 as the most likely daily high).

First support is the 1632-1640 followed by 1605-1614 area. Odds favor a trade day where price tests the 1655-1660 area in London and New York with pullbacks limited to the 1640 area (plus or minus five dollars).

What Next?

Tuesday favors a test of 1655-1665 (ideally 1655-1660) for a high and support has a few points – 1635-1641 and 1620-1625 area.

Tuesday favors touching that dotted trend line near 1655-1660 as resistance and support should be near 1635-1641. The current bounce should last into Wednesday and maybe more. It will depend on what price does at 1655 and which short term cycle we are following. Look for 1655-1665 as a favored high point for the day. Pullbacks should not be severe on Tuesday. The dotted trend line should provide resistance.

Bottom Line

A bounce is underway. The biggest obstacle is that the short term cycle turn last week may have provided a low point as the sell off came within the “window.” The turn is significant to short term and medium term implications. The OVERALL TREND is still down as we don’t have enough action since the bottom to turn the trend up. The KEY POINT SHOULD BE THE 1655-1660 area on Tuesday for upside and somewhere near 1625-1642 on the downside. The potential that we’ve make a low is in play, but we need more confirmation. Watch 1655-1660 on Tuesday.

Gold Daily Price Chart with Gann Support and resistance lines

April 10
04.00 AM GMT
Look out for a trading range of 1635/1655 for today

Compass Direction

Short-Term: BEARISH
Medium-Term: NEUTRAL

The Current Situation

Last week’s outlook in our weekly and daily updates calling for a short term cycle peak to begin ended up being the right call but we did favor it to begin near the end of the week, and not so early, getting tripped up by the FOMC minutes. The real problem is manipulation. NO ONE DUMPS 1500 CONTRACTS of 100 ounce gold at the market in one order, which is basically what happened that drove price so low at such a fast pace once again in what seems a “TIMED” reaction in the metals. We cannot feel any other way that this is just another manipulation. While we call it manipulated, they most likely feel it as a controlled event.

What gives?

While it sounds criminal and illegal as to what is going on, and it is, we have to remember that as far as gold is concerned, this is for all the MARBLES and the control of the global world currency. The GOLBAL BANKING SYSTEM and money printers will by reason of “national security” do what it has to as long as it can to maintain the status quo as in regards to maintaining the US dollar as the reserve currency. For when the dollars loses that lofty position, a major portion of the POWER behind the dollar will be eliminated and the dominance of the USA will diminish significantly. The move away from the US Dollar is now happening on multiple fronts and why most analysts have been predicting the end of the dollar power as we know it. History shows that that analysis will most likely be correct, but the element that is not known is the “TIMING” of this event.
Alas, the dollar will eventually suffer the same fate as the England and the British Pound did during the last global liquidity crisis in the 1930’s when the British Pound lost its position as the world reserve currency and England lost its position as the world leader. Indeed, at the height of British power, their empire was so vast that it was said that the sun never sets on the British Empire. Amazingly, the spark that led to the great depression was a sovereign debt default coming out of Europe which manifested the global money flow into the USA There are a few things we can take away from this. First while it will be a major blow to the USA when the dollar does lose its status as reserve currency, like England, it will not be the end of the world for USA, but it will suffer a massive loss of its citizens “standard of living.” That is the outcome and result of what is to come at a minimum. On a worse case basis, we’re talking a major currency war with China and this new war will most likely be a FINANCIAL war, but certainly conventional cannot be excluded either. And yet, the fall of western society is not different that the fall of Rome and the social evolution of the culture and the deficit spending required to fund the social and the wars put forth. It was these demands that lead to the total debasement of gold and silver coins and the eventual fall of the Roman Empire.
What we don’t know is the exact time frame of the fall from grace for the US dollar. Many did not expect that the dollar would last even this long and when we look at the chart; the dollar has not buckled over the last three years but has held its ground and is ATTEMPTING TO MOVE above its long term channel lines. The FED will do everything in its power to stop it from happening.

01.00 AM GMT
Should fall around 1639..Then a recovery up to above 1654.. is expected.
Supports / Resistances

Res 2    1,654.4300
Ex-High    1,648.6500
Res 1    1,647.3200
Pivot    1,641.5400
Sup 1    1,634.4300
Ex-Low    1,635.7500
Sup 2    1,628.6400

April 9
04.00 PM GMT

Last night’s website update listed 1645-1655 as resistance and the high so far is 1648. Support was listed at 1625-1631 and the low so far is 1636.

The gold market is supposedly tracking up off renewed hope of QE from the US Fed in the wake of the disappointing US payroll results from last Friday but that line of thinking might be put to a test in the face of ANOTHER FED CHAIRMAN SPEECH TODAY. Let me guess ------- now that a whole bunch of good trades got wiped out last week, it won’t surprise me to see him reverse his stand. It’s almost like he comes on every three days now to KEEP TRADERS on the sidelines. They must be getting hard up because the Bloomberg list had ½ of them on line to speak. With them all speaking today and Europe closed, will he now reverse his stance and send gold up 30 dollars or does he want another 50 dollars on the downside. It makes for an impossible trade scenario because the ‘control boyz’ will do what they want. With equities off almost 50 S&P points, in a few short weeks (no pun intended), maybe the control boyz are throwing him back in the ring to clarify (read will not tighten). Indeed within a few days of him saying we don’t need QE3 the latest read on Friday in the NFP number was way off and between that and the China report of 3.6% inflation for March, equities are way off.

One might also expect a hotter than expected Chinese inflation reading would have been seen as a negative to gold this morning as the Chinese are probably not in a positive yet, to step in a provide assistance to their economy. However, the gold bulls were fortunate in the wake of an end to the Indian Jewelers strike, which ended last Friday, after Indian officials promised a roll back in import taxes. With the strike lasting 20 days that is thought to have pent up some gold demand for imports ahead of an important festival at the end of this month.

However, seeing the US economy stumble in the payroll reading last week, certainly has the US and global equity markets under pressure and that action is probably serving to hold back the early gains in June gold. Traders will probably parse the speech of the US Fed Chairman at the Atlanta Fed's Annual Financial Markets conference but that speech is a dinner speech and therefore the overnight markets are likely to react to that event. With the only other scheduled data due out today, coming from the Chicago Fed Midwest Manufacturing reading it is possible that the gold bulls will need a weak number from that report to further the talk that the Fed might be forced to rethink their on-hold stance.

Asian equity markets were mostly weaker overnight, with the markets in that region put off balance by the US payroll result from last Friday and also because of troubling Chinese inflation readings that were released overnight. The European markets were still closed to be an extended holiday. US stocks were sharply lower in the early going today, with the disappointment from the US NFP results still resonating in the marketplace. From the US scheduled report front today, the market will see a Chicago Fed Midwest manufacturing report and that will be followed by a Fed Chairman Speech, which might attract extra attention, as the readings from Friday might have some analysts rekindling hopes of QE3 ahead.

Since this is just a bounce so far from last week’s selloff, the pressure is still to the downside over all but not enough to have a large favor.

Keep in mind the short term cycles --- and how BOTH charts we displayed have potential to play out. Thus whichever side gold decides on should set the pace into the April 20th timeframe. On the trade signals page we’re still looking for a set-up. WIT H THE FED and BERNANKE giving a speech tonight around 7:15 PM NEW YORK TIME ---- and with the last two plummets in gold, it is a risky endeavor to take long positions before they begin blabbing tonight. In summary – a trade range today is likely, and while odds usually favor that the gap will get filled it should be NOTED that gold is up 10 dollars from the Friday close at a time when the stock market is down 140 points, and crude oil is down 2 dollars a bbl.

That might be suggesting some under lying strength that we want to watch out for in gold. From an on balance volume point (not shown) the ‘control boyz’ have been shorting the market since around 6 am New York time. So far, gold has resisted a lot of the selling and keeps exhibiting strength as one of the very few commodity or stock that is up on the day. With Europe closed and the day after Eastre, volume is much lower than usual and so it’s questionable whether gold will hold all day. In summary – look for 1650-1655 as resistance and the 1638-1642 area as first minor support --- with the GAP area at 1632-1635 as a potential low if price weakens as the day moves on. The short term trends are still down ---and the bounce so far has been 50% from the low so it’s a prime spot for price to range trade for the remainder of the day.

04.00 AM GMT

Gold prices rose in Asian trading Monday after weak jobs data out of the U.S. on Friday stirred talk that the Federal Reserve would consider stimulating the economy via quantitative easing, a monetary policy tool that often sends gold’s traditional hedge, the dollar, falling amid a liquidity surge.
On the Comex division of the New York Mercantile Exchange, gold futures for June delivery traded up 0.87% at USD1,644.25 a troy ounce in thin holiday trading.

Gold futures were likely to test support at USD1613.55 a troy ounce, Wednesday’s low, and resistance at USD1,682.65, Tuesday’s high.

In the U.S., the Bureau of Labor Statistics reported the economy added a net 120,000 nonfarm payrolls in March, well below the range of most market expectations.

The government revised February’s payrolls to 240,000 from 227,000, but cut January’s figure by 9,000 to 275,000.

The numbers rekindled sentiments that the Federal Reserve may consider stimulating the economy by buying bonds from banks, known as quantitative easing, under which the Fed pumps liquidity into the economy in a way that weakens the dollar in exchange for increased job creation.

Inflationary fears often accompany quantitative easing, and talk that the Fed would even consider such a move sent gold rising in Asia on Monday.

Elsewhere on the Comex, silver for May delivery was up 0.46% and trading at USD31.875 a troy ounce, while copper for May delivery was down 0.25% and trading at USD3.788 a pound.

00.00 AM GMT

Gold futures rebounded as bargain hunters honed in after dashed expectations of further U.S. monetary stimulus prompted a sharp decline for both metals in the previous session.
Gold climbed $16, or 1%, to end at $1,630.10 an ounce on the Comex division of the New York Mercantile Exchange.

The gains were not enough to erase weekly losses of 2.5% for gold. Commodity markets were closed Friday in observance of Good Friday.

It is a very quiet day, with global markets closed for the holiday weekend.

The Non Farms Payroll data showed for the first time since November that job growth dropped below the 200,000 level. Economists expected a rise of 210,000. The unemployment rate fell to 8.2% from 8.3%, mostly because more people dropped out of the work force.

In the forex markets, the dollar fell against other major currencies, posting a particularly steep drop against the Japanese yen, which tends to be seen as a safe-haven currency.

Economic Events scheduled for April 9, 2012

02:30 CNY Chinese CPI (YoY) 3.3% 3.2%

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.

02:30 CNY Chinese PPI (YoY) -0.2%

The Producer Price Index (PPI) measures the change in the price of goods sold by manufacturers. It is a leading indicator of consumer price inflation, which accounts for the majority of overall inflation.

10:00 EUR Greek CPI (YoY) 2.10%

Consumer Price index is the most frequently used indicator of inflation and reflect changes in the cost of acquiring a fixed basket of goods and services by the average consumer.