Each week Lo
ngleaftrading.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 15 through October 19)
I stand corrected and I do not mind admitting it. The past few weeks, I have been suggesting that December Gold would see short dips being bought and would likely rally through $1800 an ounce in the near future. We begin this week trading below $1750 an ounce and I am somewhat surprised. While today’s low is seen as a decent support level off of the September 26th price, I am still left questioning whether Gold’s hangover will continue.
Normally I try to fill this report with a review of last week’s fundamentals to explain the trade, but I will spare you the boredom. Here is a “Cliff’s Notes” version of the reports and action last week from the United States, Europe, and China. In the United States, the idea of QE3 (printing US Dollars and purchasing debt) has now officially faded as most markets have corrected the move up. On top of that, the huge Michigan Consumer Confidence number only resulted in a thirty second rally, followed by a selloff to finish the week. In Europe, there is one thing only to report. That is that for the sixth week straight, the market continues to worry about whether or not Spain will request a bailout and allow the ECB to buy Spanish debt and reduce borrowing costs. Thankfully, none of the traders that I know are holding their breath waiting for a final answer from Spain. And in China, the reports continue to be one question mark after the next. So what are we left with? We are left trading technicals in lighter volume that are still driven by HFT programs. I believe that if we do not hear about a formal request for a bailout from Spain soon, that we may have to wait until after the US Presidential Elections before the market environment changes. Continue reading "Gold Chart of the Week"
