News Bites
Gold sees no serious chart damage yet; and a postulation
(Kitco News) - See on the daily bar chart for December Comex gold futures that Monday’s big losses have pushed the yellow metal back into the bottom portion of the recent sideways trading range - after prices hit a seven-week high overnight. Importantly, no significant chart damage has been inflicted on the daily or the longer-term charts. However, bulls need to defend strong technical support at the September low of $1,851.00. A drop below that price level would inflicted serious near-term chart damage to suggest a new leg down in prices.
Here's a postulation for the gold market bulls to ponder: This vaccine news is short-term negative for gold, no doubt. However, could it be that as global economies spring back to life in the coming months and we still have a lot of money in the global financial system and probably more stimulus in the near term, that this vaccine news could end up being longer-term bullish for gold? Could it be that economies will spring back to life faster with the vaccine and thus problematic price inflation becomes even more probable sooner? Remember that inflation is bullish for raw commodity markets, including the metals. Don’t rule this scenario out. This 35-year market watcher is still longer-term bullish gold and silver—and the raw commodity sector. Tell me what you think. I always enjoy hearing from my Kitco readers around the globe.
