CPM Group Trade Signal - June 17, 2021
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Featuring views and opinions written by market professionals, not staff journalists.
Prices as of 9:30 a.m. EDT (14h30 GMT) 17 June 2021 $1,786.70 (Basis the August 2021 Comex Contract).
Direction: Take Profits and Stand Aside
Initial Target Price/ Range: $1,770 - $1,800
Initial Timeframe: 17 June 2021 to 22 June 2021
The most recent gold Trade Recommendations have been Sell recommendations, beginning at $1,900 five trading days ago, on 10 June, reiterated on 15 June.
Gold prices fell sharply Wednesday and this morning. The occasion for the sell-off was the combination of the Fed's comments that it may start raising interest rates in 24 months or so since the economy in fact is showing signs of recovery, and a six basis point increase in the 10-year Treasury interest rate, albeit well within recent ranges. The cause was investor optimism about the economic recovery in the United States, China, and Europe, which has led to some unease in recent weeks about being long gold and silver.
It is totally unclear whether the decline is past or whether there is more, possibly much more, to come. CPM's best guess is that prices may consolidate between $1,770 and $1,800 over the next two to four days. After that, prices may rebound to around $1,820 - $1,850, or another leg down. If a 'measured move' is forming in gold prices, the downside objective would be $1,680 – the low touched twice in March.
CPM would advise spot investors to lock in any profits on short positions and stand aside for a few days to await clarity in the next move. It would advise options-based investors to buy straddles.
Initial Target Prices and Timeframes are just that: Initial. If CPM does not issue a new Recommendation during or after that time it indicates that CPM is maintain the posture in the most recent Trade Recommendation.
Discretion should be allowed at +/- 0.20% of the price at the time each TR is issued from the target. Recommendations are valid until the target date or a new Trade Recommendation or message is issued by CPM.
CPM's preferred investment strategies use physical, futures, forwards, and options.
Disclaimer – Past performance is no indication or guarantee of anticipated future profits, and neither Kitco Metals Inc. nor CPM Group can accept any liability or responsibility for any loss suffered as a result of gold price fluctuations. Gold as a commodity is not a specified investment for the purpose of giving advice under the Financial Services and Markets Act 2000. Therefore this trade recommendation does not give rise to rights to claim compensation under the Financial Services Compensation Scheme. CPM Group is a registered CTA with the U.S. NFA and CFTC. At times the principals and associates of CPM Group may have positions in the precious metals, commodity, and equities markets. CPM Group also manages investment and industrial positions in markets for its clients.