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Why isn't Gold exploding higher? - RJO Futures Weekly Gold Outlook

Commentaries & Views

Gold Focus – Gold futures have really been disappointing despite in my opinion having the ammo to break out to new contract highs. So if gold isn’t moving up with the extreme volatility in equities then clearly we need to look at what’s driving it lower. The biggest headwinds are: rising interest rates, a stronger dollar and lack of safe haven demand. Now I’m not giving up on the upside of gold because chances are the dollar will begin to weaken again after the hangover from comments from the ECB and BOE dissipate and interest rates have probably risen too far too fast. Once this happens we should see gold start its recovery.

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Daily Chart Analysis and Price Outlook

The charts above are from provided by RJO Futures PRO  an exclusive and sophisticated online trading platform with integrated tools to seamlessly trade and monitor the markets.

Analysis and Outlook

The daily gold chart shows momentum indicator MACD turning lower after rising into overbought territory and stochastics are moving into oversold territory. This tells you that the trend has been weakening and you can confirm that using ADX. ADX, which measures strength of the trend, has weakened to 37.22 showing that the trend is continuing to weaken. Gold really needs to move back over $1350 to ignite another wave of aggressive buying. Caution should be taken if we see a two day close below $1308 which is the 50 DMA where a washout could occur down to $1290 could occur which is the 200 DMA. I have put together an options strategy to try and capitalize on this scenario so please reach out to me if you are interested in learning more. Also be sure to check out our 2018 Metals Outlook here:  2018 Metals Outlook

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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