Gold Chart of The Week

Each Week Longleaftrading.com will be providing us a chart of the week as analyzed by a member of their team. We hope that you enjoy and learn from this new feature.

Weekly Gold Report (October 14^th through October 18^th)

What can be said about the week that lies ahead? More of the same sounds about right. After Democrats and Republicans spent another full calendar week bickering and positioning, we seem to be no closer to a deal than we were in the prior week, and the threat of a default on debt continues to loom.

So as we inch closer to the final deadline (October 17^th), we should expect to hear from Government officials along with members of the US Federal Reserve, all of whom can say the right OR wrong words for the day and have an impact on the direction of a market. There have been a few reports cancelled because of the Government Shutdown and we expect a few to be cancelled again this week leading up to the 17^th. And the reports that are released (including a few from China in the middle of the week), will likely take a back seat to any progress OR lack thereof made in Washington.

The daily chart of the December Gold Futures shows a continued slide in prices. Last week’s price action was weak and even included a sharp drop below the October 2^nd low print. Sell-stop orders were triggered after a large sell order was filled near the open on Friday. This drove Gold sharply lower and even halted trading for a short period of time. Since then, the price of December Gold has held within the prior days trading range, but remains questionable in either direction.

I remain neutral on Gold this week because of the potential for a very volatile week. With the release of data in China coupled with the US debt ceiling debates, I think this week leaves Gold vulnerable to similar moves like the one we saw on Friday. Until Gold shows me a few closes above the resistance trendline that has kept a lid on upward action (arrow #1), I will remain on the sidelines and enjoy the show.

If you would like to discuss trading in the Futures and Futures Options markets with me, please feel free to call or email me directly. You can reach me directly at (888) 272-6926 or by email at bb****@lo*************.com.

Thank you for your interest,
Brian Booth
Senior Market Strategist
bb****@lo*************.com
888.272.6926

** There is a substantial risk of loss in trading futures and options. Past performance is not indicative of future results. The information and data contained in this article was obtained from sources considered reliable. Their accuracy or completeness is not guaranteed. Information provided in this article is not to be deemed as an offer or solicitation with respect to the sale or purchase of any securities or commodities. Any decision to purchase or sell as a result of the opinions expressed in this article will be the full responsibility of the person authorizing such transaction.