Gold Futures Saw 10-month Lows and Bounced

Gold Futures Saw 10-month Lows and Bounced

Gold Futures Saw 10-month Lows and Bounced


Gold futures headed for the lowest closing in 10 months as investors ignored the political problems in Italy to boost stocks and other riskier assets.

Monday, the S&P 500 advanced and Treasury yields rose after Italy’s vote against constitutional reform, which drove the nation’s PM to resign. While the referendum has raised concerns over Italy’s future in the Eurozone, the nation’s political and legal system means the “No” vote is unlikely to trigger a quick exit, sapping demand for safe-havens.

Gold has been volatile this year following unexpected political votes in major economies.

It spiked after Britain’s vote to quit the EU in June, then fell as Donald Trump’s Presidential victory boosted bets that the Fed will raise interest rates this month. The precious Yellow metal declined the most in more than 3 years in November on signs of improving US economic growth.

Precious metals are in a downtrend.

Gold futures for February delivery fell 1.2% to 1,164.10 oz at 10:04a on the COMEX in New York. A close at that price would have been the lowest for a most-active contract since 5 February, but it bounced and is currently trading at 1,75.40.

Note: This bounce it could target 1200-1210 before resuming the fall back to current marks.

The prospect of higher U S interest rates dampened the appeal for bullion because it does not pay any yield.

Investors sold metal from ETFs (exchange-traded funds) for a 16th day running Friday, the longest run since March 2015. Holdings dropped 2.2 tonnes to 1,859.3 tonnes, the lowest since June, data shows.

Money managers and other speculators are the least Bullish Gold prices since February. They cut their net-length position on Gold futures and options by 15% in the week to 29 November the COT data show.

HeffX-LTN Analysis for NYSEArca:GLD: Overall Short Intermediate Long
Bearish (-0.45) Very Bearish (-0.71) Very Bearish (-0.50) Neutral (-0.14)

Stay tuned…

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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