(Originally posted yesterday with appropriate charts) Gold takes a breather, while negative data continues to pour in. Gold’s inability to close above $1,300 is a mild hit for bulls, but prices will likely consolidate prior to the next leg higher. Prices declined to $1,280 per toz., just above the descending trend line, now support. The likely scenario is that...
Gold is up 9 percent YTD. Gold is on a tear since I warned that negative price action was waning on January 6 (here). Gold has been able to overtake the $1,240 per toz. hump and chug along on global growth concerns. The IMF, just among the bunch, lowered the outlook for growth prospects; and the second largest economy – China – is pulling back, down to the...
WTI has played out fundamentally, and the fundamentals (along with sentiment) still remain to the downside. Traders love to pick out bottoms by catching falling knifes, and they're usually cut up in the process. On a risk:reward basis, sure WTI may seem like it's at a nice area to buy. Yet, I think it is still to early. Crude will likely find support at the...
The EURUSD is currently trading in a multi-year demand zone on the weekly chart. Since 2004, the pair has reached this area four times, each resulting in a nice upward trend. On the other hand, if this zone is broken, the pair could freefall. If the euro can muster enough support within this zone (which extends to 1.1685) the pair could see a rather nice pullback...
Gold climbs higher on traders looking for safety, albeit crude, equities, the ECB or Greece. As what was considered a year for the “secular” bull market to continue higher, 2015 is looking to start the year rather tumultuous. In “Gold $1,200 – A Line in the Sand,” gold began to form a descending channel after breaking through the previous ascending channel. I...
In my previous analysis "Que 2008," I likened this drop in oil similar to the one we've seen in 2008. This was based on both over leverage in the oil and equity markets, diverging fundamentals and a strengthening dollar throughout 2009 - which brought on deflation. Prices did collapse through $60 as expected, and nobody is willing to cut production to reserve...
BOJ is exporting deflation to the rest of the world and has also lifted all global stocks as BOJ has said it will be buying global stocks and bonds. It looks like the 33 plus year bear market in the NIkkei may be coming to an end.
Is the endgame going to be hyperinflation or deflation? Hyperinflationists took gold to new highs with the onset of super easy money starting with 2003 and broke all time records just shy of 2000 with QE1 and QE2. Despite the speed with which M1 is being created in US, China, Japan, EU and UK (through various QE), monetary velocity is still decreasing in the...