Gold: Looking at these profiles and the attached 4H price chart its a little difficult to determine what value point is truly in control. We sit at the cusp between $1,293 and $1,259 really. Now on Thursday I posted that the move in Gold did not start from the $1,293 POC,plying a move back to that level - Im wondering now if that was incorrect - as when we look at the price chart I was perhaps splitting hairs with that call. The post 4/13 profile suggests that $1,293 is still in control, but the post 1/14 data says its really line ball and it could easily go south to $1,259. Combined with the fact that even in sight of Friday end of week position squaring / profit taking / short covering, we could not get over $1,283 intraday, we revisited the lows again, and Silver was not really confirming any impending bounce with its close down at $19.42. Im more inclined to think now that weakness will prevail, and that the consolidation from $1,271 and $1,282 will extend (even if we make it back up to 1,287) down on a flagpole basis towards the lows at $1,240. As of writing there is no real significant update on Ukraine to give us a gold catalyst, this being said, Ukraine Government troops continue to make up ground in the east, but Iraq is still a mess politically with Sunnis pretty annoyed with the Shia after some 60 odd Sunnis were killed by a Shia militia at a mosque and have since walked out of unity government talks apparently. Hamas are now executing Israeli collaborators in public but still taking it on the chin from the Israeli A/F which continues to bomb them back into the stone age. The US has been talking about expanding the operation against ISIS in Syria - but obviously dont want to be seen to be supporting Assad. Separately, there are now some pretty impressive videos out of drone attacks on ISIS bases killing every last two legged moving object (picked off one by one over 15 minutes) but sparing all the horses to show some kindness. Its pretty clear ISIS have no chance when pitted against the drones. None of these latter developments are showing any sign of threatening Crude Supplies which are the most important thing - Crude is closing quite low at $93.65. In summary - Im waiting for a Whitehouse & EUR Sanction response to the Russian aid convoy. If the west does not respond to that one then the precedence is set for rolling more hardware over the border IMO. Tuesday has the Ukranian summit so I would have been thinking that things are mostly contained for the moment, which is also evident in the record close of the S&P500, so I find no Geopolitical reason to be stocking up on Gold in case of WW3 at the moment. Forecast for the week to come: Weakness to prevail. If you want to join the discussion, feel free to join us at the FB Open Group DFMindset.
Posted on: Sun, 24 Aug 2014 03:26:38 +0000