Why isn't Gold exploding higher? - RJO Futures Weekly Gold Outlook
Kitco Commentaries | Opinions, Ideas and Markets Talk
Featuring views and opinions written by market professionals, not staff journalists.
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
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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