Wednesday, November 25, 2015

Gold Trend..

Reuters reports today - Gold and silver languished near their lowest levels in six years on Tuesday, while platinum dipped to a seven-year low on a strong dollar and growing expectations that the Federal Reserve would increase U.S. interest rates next month.
Outflows from exchange-traded funds backed by the metals, all non-interest-paying assets, as investors position for a rate hike are also hurting prices.
"Speculators expect a rate rise next month, so people are dumping their gold. The longs are liquidating," said Ronald Leung, chief dealer at Lee Cheong Gold Dealers Ltd in Hong Kong, adding that a reversal in dollar strength could help prices.
The dollar hit an eight-month high on Monday on hopes of a rate hike. A firm greenback makes dollar-denominated commodities more expensive for holders of other currencies.
San Francisco Fed President John Williams on Saturday cited a "strong case" for raising rates when Fed policymakers meet next month, as long as U.S. economic data does not disappoint, echoing other officials. Nonfarm payrolls data earlier this month also supported views of a strong economy.
"Physical demand is a little bit supportive of gold price for the time being but it is not aggressive," Leung said.
Sustained strong physical demand in top consuming region Asia tends to provide a floor to falling prices.
Premiums on the Shanghai Gold Exchange, a proxy for physical demand in China, were at $5 an ounce on Tuesday, versus $3-$4 in the beginning of the month.
Investment demand, however, was lacklustre.
Assets in SPDR Gold Trust, the world's largest gold-backed exchange-traded fund (ETF), tumbled to 655.69 tonnes on Monday, the lowest since September 2008.
Holdings of platinum ETFs are at a two-year low, while assets in palladium funds are close to their lowest since April 2014.
"The recent PGM (platinum group metal) price weakness is more dollar and investor sentiment driven," said HSBC analyst James Steel. "While the near-term path of least resistance appears lower we believe PGMs are close to plumbing the lows."
Technically we still work with our riddle - contradiction between grabber and morning star pattern. Our position is - grabber is stronger. But it does not mean that gold will go to 1038 target directly. It keeps chances to show upside retracement first, just because grabber's target is not downward continuation but just stops below recent lows. Once they will be hit - gold could change the course.
That's why for us it will be very important - whether we will get W&R around 1060 or not.
If we will get W&R - on 4-hour chart we could small H&S pattern in current action and larger H&S with double head pattern. Potential retracement could reach 1110 area. In nearest hours we will watch for small grabber here, on 4-hour chart and what will happen around WPS1. Appearing of W&R will increase chances on upside bounce. If gold will drop below and stay there - then downward action should continue.
Still, for bullish positions it is not time yet. Wait for clear W&R signs or upside action above 1085. Only in this case we will get confidence for scalp long trades:

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 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.