Is this gold's market top?
(Kitco News) Is a price pullback inevitable here as gold settles in above the $1,950 an ounce level? TD Securities says there is some evidence suggesting the gold might be near its market top. “100% of the momentum indicators computed in our ChartVision tool, which aggregates 75 technical signals across momentum and mean-reversion strategies, are pointing long in gold. While not a timing indicator, this has historically coincided with market tops as it has been followed with periods of consolidation,” TD Securities strategists write. Technical positioning also looks overextended, the strategists add. “This coincides with our interpretation of an 'overshoot', as excessively positive sentiment, frenzied speculation, and signs that consensus themes are driving trading decisions have all conspired to send gold prices far beyond its observed drivers over the past months. The rally has outpaced the real rate decline and positioning has become bloated, which also suggests that a period of consolidation could be in the cards.” The Federal Reserve interest rate announced will be carefully watched Wednesday afternoon for “any signs of disappointments which could be a catalyst for consolidation.”