We have been stopped out of our position on the trade opened on 15 Feb 2013 (long Apr Gold @ 1603) at 1582 for a loss of $21.
The gold market looks remains off balance and under pressure as gold prices have violated important chart support areas.
While there were reports of Indian gold buying overnight, support from that news flow was limited by concerns that the Indian government will continue to discourage gold imports. In fact, the Indian government overnight announced that they would move to suspend gold imports from Thailand. While the suspension of Thai gold imports into India might have simply been the result of the Indian government closing a tax loophole, the trade has to remain concerned that the Indian government will implement other restrictions in an effort to diversify Indian investments.
In another negative development gold holdings of a gold derivative instrument fell to the lowest levels since September 21st of last year, in a report yesterday afternoon. Apparently gold saw little support from news that AngloGold Ashanti posted a quarterly loss because of labor issues at a mine in Ghana. The company also predicted 2013 gold production to be between 4.1 million to 4.4 million ounces but they also suggested that gold production could be revised lower because of ongoing labor troubles in South Africa. News that AngloGold would look to reduce costs to the worlds lowest, in a few years, through the implementation of the most significant change in Mining technology in 100 years, might suggest to the unions, that machines will replace workers ahead and that could energize the South African Mine workers union.
Chinese shares were higher overnight off favorable investor interest in Chinese retail issues. Chinese shares might also have garnered a delayed lift from stronger than expected German sentiment data that was released earlier this week.
British share prices reached up to a 5 year high overnight off ideas that the BOE was poised to provide more support to the UK economy. The other side of the coin is that the British pound fell sharply and with that news the media is talking up the “currency war” scenario and the gold drop really shows how splintered the market is as it doesn’t make sense. Either the real situation is a deflation scare and a sell off not just in gold but all the markets are going to join hands or gold is on the verge of making a low. You can’t have it both ways where currencies are fighting to devalue and gold goes down.
Housing starts reported this morning were “spun” as positive on the media outlets. But the big news today will be the FED FOMC minutes release. We don’t expect any policy changes and regardless of what is said, the control boyz are going to do what they want. With this huge drop in gold they’ve either washed everyone out and will allow a spike up to take place or they could really hit the sell button as they chart damage has lost some important trend channels.
Part of the issue is the increasing tone of the left and right wings of US government as the debt issue is fast coming to a head on March 1stand the tension is growing by the moment as each side is throwing jabs in public forums.
Underlying all of these issues is no matter how hard the economic recovery is spun there’s continues to be growing concern in USA that retail sales are going off a cliff. In summary, Europe cracks are re-appearing and at the same time the UK and US situation is increasingly entering into the headlines. In summary the tensions are growing and the gold stocks are acting in a similar manner and price pattern that was evident in the last liquidity squeeze.
The waterfall event developing in gold is that a major channel line break from the crash low was breached and the recovery attempt from 1600 failed for the 2nd day and that has brought a lot of selling with this breach. The 34 month moving average is at the 1548 level. Additional support lies at the 1500-1520 area and then around 1470.
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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.
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
