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Thank you Mr Trump.
more to come. 
more to come. 
Gold Price - Where is it heading?
- Thread starter guycharles
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It’s been a volatile year for stocks so far, but more surprising is that gold prices, which have rallied more than 25% YTD, have been even more volatile. Year to date, the SPDR Gold Trust (GLD) has experienced a daily move of at least 1% on 40% of all trading days compared to 37% for the S&P 500, as measured by the SPDR S&P 500 ETF (SPY).
The chart below shows the rolling 50-day average number of daily 1% moves in GLD over the last 20 years. The current level of 54% is modestly below the recent high of 56%, and that was the highest frequency of daily 1% moves since late 2011! The second chart shows the same calculation for SPY over the last 20 years. While the current level of 42% is hardly extreme relative to history, earlier this month it was at 52%.
In both charts, areas where the line shifts from blue to red indicate periods when both GLD and SPY had 1%+ daily moves on more than 40% of trading days in a rolling 50-day period. The only periods in the last 20 years when both ETFs simultaneously had 1%+ daily moves over 50 days were during the Financial Crisis, late 2011 after S&P downgraded the US AAA credit rating, early 2016, Covid, and now.
The chart below shows the performance of GLD over the last 20 years, and here again, the red line indicates the periods when both GLD and SPY had 1%+ daily moves at least 40% of the time over a 50-day span. For GLD, there was no consistent pattern of performance leading up to or after these periods.
For the S&P 500, however, the pattern surrounding these occurrences was more consistent. Except the Financial crisis when elevated levels of volatility in both ETFs started just after the S&P 500’s peak and continued for most of the bear market, in the three other periods (and the current period), it wasn’t until late in the decline or after the market made its low that the average number of 1% daily moves in each ETF exceeded 40%.
jog on
duc
The chart below shows the rolling 50-day average number of daily 1% moves in GLD over the last 20 years. The current level of 54% is modestly below the recent high of 56%, and that was the highest frequency of daily 1% moves since late 2011! The second chart shows the same calculation for SPY over the last 20 years. While the current level of 42% is hardly extreme relative to history, earlier this month it was at 52%.
In both charts, areas where the line shifts from blue to red indicate periods when both GLD and SPY had 1%+ daily moves on more than 40% of trading days in a rolling 50-day period. The only periods in the last 20 years when both ETFs simultaneously had 1%+ daily moves over 50 days were during the Financial Crisis, late 2011 after S&P downgraded the US AAA credit rating, early 2016, Covid, and now.
The chart below shows the performance of GLD over the last 20 years, and here again, the red line indicates the periods when both GLD and SPY had 1%+ daily moves at least 40% of the time over a 50-day span. For GLD, there was no consistent pattern of performance leading up to or after these periods.
For the S&P 500, however, the pattern surrounding these occurrences was more consistent. Except the Financial crisis when elevated levels of volatility in both ETFs started just after the S&P 500’s peak and continued for most of the bear market, in the three other periods (and the current period), it wasn’t until late in the decline or after the market made its low that the average number of 1% daily moves in each ETF exceeded 40%.
jog on
duc
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Everywhere in blogoland you read that gold is the most overcrowded trade in the market. That this somehow implies that gold is overvalued, overbought on a technical level, blah, blah.
Gold's fundamentals are being driven via a monetary reset.
UST paper is no longer money good. It is a wasting asset. It can no longer serve as a reserve asset when exchanged for oil in particular but commodities generally.
The US also WANTS this reset. Only on its terms. That is not happening, it's happening on China et al's terms.
So chart 1.
Bessent as part of his 3 Arrows strategy intended to lower the POO and concurrently the 10yr yield would also fall. That relationship is now broken. As POO falls, 10yr rises.
Which implies, had POO been higher that 10yr yields would have been even higher.
Chart 2
In this chart, as POO rises, the 10yr yield also rises. Which supports the conclusion in Chart 1.
This is because allies of the US who still purchase oil in USD, need more USD to offset the rise in POO.
Solution: they sell UST to obtain USD to purchase oil (or any commodities).
So whether POO rises or falls, 10yr yields rise.
Chart 3
The trend is easy to see.
UST/Oil is flat to falling.
Gold/Oil is rising.
Which simply means that more and more oil (commodities) will use gold as the reserve asset.
Which means that as the oil market is 16X+ larger than the gold market, gold needs to 16X. Add in the other commodities for zero and god needs to trade at $56,000oz.
A while back I showed that gold needed to trade at $26,000oz to cover China's trade balance.
Is gold an overcrowded trade?
Gold doesn't even register in their holdings. LOL.
What about the trading Banks?
So the Commercials (big trading banks) are:
(i) buying USD to cover short positions; and
(ii) buying gold to cover short positions.
This in the gold market is primarily JPM who is the agent for the US govt.
Remember the post re. using gold as a way to add liquidity via a very quiet QE operation?
Their fingerprints are everywhere.
In summary: this is a secular gold bull market that has 10yrs+ to run.
The reason for 10yrs is that is probably the length of time it will take the US to inflate away the debt and reshore manufacturing capacity while retraining a workforce.
The last time this happend, post WWII, it took from 1949 to 1982 to reset the debt levels. There were two additional wars in that period, Korea and Vietnam, which obviously slowed the process as both increased the debt levels again. Nixon in 1971 was forced off the gold standard at that point.
From Reminiscences:
In an early chapter of Reminiscences of a Stock Operator, Jesse Livermore (who goes by the name of “Larry Livingston” in the book) introduces us to an older gentleman — “one old chap who was not like the others” — who hung around his brokerage office.
This elder statesman — known as “Old Turkey” — preferred to keep his own counsel and did not participate in the wild speculation and gossip of the others. His quiet confidence gave him a certain gravitas that impressed his compatriots. They often sought out his advice before making a buy or sell decision.
At least not at first.
One day, a regular named Elmer burst into the office and made a beeline for Old Turkey. Elmer breathlessly told him that he was selling his position in a particular automaker and urged the old man to do the same.
But, much to Elmer’s surprise, Old Turkey was not impressed. He kindly brushed aside the excitable young man’s increasingly insistent warnings that the company’s stock price would surely drop in the coming days and weeks.
Old Turkey just smiled and repeated his mantra.
Old Turkey replied:
“The more I studied, the more I realized how wise that old chap was,” he said. “He would not lay himself open to a temptation that experience had taught him was hard to resist and had always proved expensive to him — as it was to me.”
LOL.
Add in the previous post re. gold vol. and you have increased difficulty in trying to time (trade) the market.
jog on
duc
Gold's fundamentals are being driven via a monetary reset.
UST paper is no longer money good. It is a wasting asset. It can no longer serve as a reserve asset when exchanged for oil in particular but commodities generally.
The US also WANTS this reset. Only on its terms. That is not happening, it's happening on China et al's terms.
So chart 1.
Bessent as part of his 3 Arrows strategy intended to lower the POO and concurrently the 10yr yield would also fall. That relationship is now broken. As POO falls, 10yr rises.
Which implies, had POO been higher that 10yr yields would have been even higher.
Chart 2
In this chart, as POO rises, the 10yr yield also rises. Which supports the conclusion in Chart 1.
This is because allies of the US who still purchase oil in USD, need more USD to offset the rise in POO.
Solution: they sell UST to obtain USD to purchase oil (or any commodities).
So whether POO rises or falls, 10yr yields rise.
Chart 3
The trend is easy to see.
UST/Oil is flat to falling.
Gold/Oil is rising.
Which simply means that more and more oil (commodities) will use gold as the reserve asset.
Which means that as the oil market is 16X+ larger than the gold market, gold needs to 16X. Add in the other commodities for zero and god needs to trade at $56,000oz.
A while back I showed that gold needed to trade at $26,000oz to cover China's trade balance.
Is gold an overcrowded trade?
Gold doesn't even register in their holdings. LOL.
What about the trading Banks?
So the Commercials (big trading banks) are:
(i) buying USD to cover short positions; and
(ii) buying gold to cover short positions.
This in the gold market is primarily JPM who is the agent for the US govt.
Remember the post re. using gold as a way to add liquidity via a very quiet QE operation?
Their fingerprints are everywhere.
In summary: this is a secular gold bull market that has 10yrs+ to run.
The reason for 10yrs is that is probably the length of time it will take the US to inflate away the debt and reshore manufacturing capacity while retraining a workforce.
The last time this happend, post WWII, it took from 1949 to 1982 to reset the debt levels. There were two additional wars in that period, Korea and Vietnam, which obviously slowed the process as both increased the debt levels again. Nixon in 1971 was forced off the gold standard at that point.
From Reminiscences:
In an early chapter of Reminiscences of a Stock Operator, Jesse Livermore (who goes by the name of “Larry Livingston” in the book) introduces us to an older gentleman — “one old chap who was not like the others” — who hung around his brokerage office.
This elder statesman — known as “Old Turkey” — preferred to keep his own counsel and did not participate in the wild speculation and gossip of the others. His quiet confidence gave him a certain gravitas that impressed his compatriots. They often sought out his advice before making a buy or sell decision.
But, as Livermore ruefully admitted, no one quite grasped his meaning.
At least not at first.
One day, a regular named Elmer burst into the office and made a beeline for Old Turkey. Elmer breathlessly told him that he was selling his position in a particular automaker and urged the old man to do the same.
But, much to Elmer’s surprise, Old Turkey was not impressed. He kindly brushed aside the excitable young man’s increasingly insistent warnings that the company’s stock price would surely drop in the coming days and weeks.
Old Turkey just smiled and repeated his mantra.
A stupefied Elmer could not believe what he was hearing. He pleaded with Old Turkey to at least sell off some of his position and then buy back in after the price dropped lower. “You might as well reduce the cost to yourself,” he said.
Old Turkey replied:
It finally began to dawn on Livermore what Old Turkey was saying. That jumping in and out of the market — even with the best of intentions — just doesn’t work.
“The more I studied, the more I realized how wise that old chap was,” he said. “He would not lay himself open to a temptation that experience had taught him was hard to resist and had always proved expensive to him — as it was to me.”
LOL.
Add in the previous post re. gold vol. and you have increased difficulty in trying to time (trade) the market.
jog on
duc
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Gold Miners:
The only caveat being that miners are easily nationalised, profit capped, etc.
jog on
duc
The only caveat being that miners are easily nationalised, profit capped, etc.
jog on
duc
Garpal Gumnut
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With apologies to the Gold bulls, I still cannot get too excited. The 6mo. chart shows lower highs and lower lows since mid-late April. Profit taking is well on today. Gold needs to get well above $3400 for me to be convinced that $3500 and $4000 are achievable.
I may just change my mind and add if it falls below or close to $2800, unlikely imo but not an impossibility. Everyone says it's going to the moon, so it ain't imo., just because everyone's saying it. I'd also certainly be looking at $GDX and $GDXJ in that case, the case if it falls.
gg
I may just change my mind and add if it falls below or close to $2800, unlikely imo but not an impossibility. Everyone says it's going to the moon, so it ain't imo., just because everyone's saying it. I'd also certainly be looking at $GDX and $GDXJ in that case, the case if it falls.
gg
Garpal Gumnut
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Gold is being a bit bumpy bumpy in the short term over the past month. A head and shoulders has just formed. If it drops it will bring us back to around $3200. The $NVDA results will suck some main st. dollars back in to the NASDAQ.
gg
gg
Sdajii
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Your head and shoulders looks pretty valid and will likely play out.
The target of your head and shoulders very nicely lines up with bouncing off the trend line which has been established for about half a year and forms the base of the pennant I showed recently, which for some reason was mocked and doubted. Interestingly, since then it bounced perfectly off the upper resistance line (within a few cents of the line I showed in my previous post).
If you H&S lines up perfectly with my pennant, the target of about $3,200 will be hit mid next week and *disclaimer this is not advice and for legal reasons this is for entertainment purposes only* we should all totally buy up when it bounces off the trend line and has positive momentum above $3,200 for an easy 20%+ gain (I'm assuming it won't actually hit the target and I wouldn't buy right at the technical expected low or suggest doing so not that I'd ever suggest anything at all even if it was as obvious as buying after a clear bounce off two targets with a 20%+ return on something as bullish as gold currently is with the easy ability to see out in the unlikely event things go bad because it is as liquid as gold is...)
The technical target according to the way I usually calculate pennant targets (the most conservative way) is a little under $4,000 and for multiple reasons (some of which I've discussed in the thread previously) is my exit point likely with a few to buy back later, cheaper.
Garpal Gumnut
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I've been caught out selling with the intention of buying in cheaper. All the best with it though. @Sdajii
gg
gg
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Full:
China/Russia have been facilitating multi-currency commodity pricing with net gold settlement for years. Now western investors with premier pedigrees are facilitating the same (Crumb worked closely at Goldman Sachs with longtime GS commodities head Jeff Currie, who is on Abaxx’s board.) Why are westerners like Crumb doing this?
Because they are smart realists that understand what Jelle Zijlstra and the BIS knew 45 years ago: You cannot use sovereign debt whose value is melting in real (oil) terms as the collateral or backing of the system; the system will collapse. The system MUST transition to a collateral that maintains or gains value against commodities over time – gold for now.
Which means that there will be a constant bid for physical gold.
jog on
duc
Sdajii
Sdaji
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Neat! What was the spot price when you sold? What's your target buyback? I can at this point seeing it potentially either bouncing off the lower trendline around $3,200 before breaking the upper trendline, or just going straight for the breakout. Of course there's the potential for anything and it could break that lower trendline, but I think that's likely and with such a strong supporting trendline showing no signs of breaking I've not sure why you'd sell this close to it while still above.
As a current holder I have some reluctance to wish luck to a shorter, but good luck
If that lower trendline does break I'll be joining you.
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From Market Matters morning report
marketmatters.com.au
Gold Spot ($US/oz)
"Gold reversed higher by ~$US70/oz after the $US failed to hold onto gains following the federal courts ruling around tariffs. Gold rapidly came back into favour as analysts cautioned that there are plenty of alternative routes the president could pursue to ensure his flagship economic policy is not derailed. While gold ETFs have experienced five straight weekly declines, it’s looked more like consolidation than major liquidation and signs of selling exhaustion are rising as the $US dollar slips back towards its 2025 lows.
We can see gold breaking above $US3500/oz in line with the weak Greenback.
MM is bullish towards gold in the coming months"
Market Matters | Leading Australian Stock Market Views And Advice
Get the latest Australian stock market views from top investors with real money in the markets. ASX investment advice and share recommendations. Find out more.
marketmatters.com.au
Gold Spot ($US/oz)
"Gold reversed higher by ~$US70/oz after the $US failed to hold onto gains following the federal courts ruling around tariffs. Gold rapidly came back into favour as analysts cautioned that there are plenty of alternative routes the president could pursue to ensure his flagship economic policy is not derailed. While gold ETFs have experienced five straight weekly declines, it’s looked more like consolidation than major liquidation and signs of selling exhaustion are rising as the $US dollar slips back towards its 2025 lows.
We can see gold breaking above $US3500/oz in line with the weak Greenback.
MM is bullish towards gold in the coming months"
Garpal Gumnut
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i must admit that I fail to see why everyone is getting so excited about Gold atm. It is in a downtrend and has been for over 2 months. I'm bullish on gold in the medium to long term, but in the short to medium term it is in a downtrend with lower highs and lower lows and one must respect the trend.
Depending on people's circumstances this may be a buying opportunity but it is certainly not a bullish signal. Most commentators including Wyckoff on kitco.com are spruiking as being bullish on 2mo. out futures charts. Spot Gold is falling in price. It may go lower or go higher but chartwise it is more likely to fall further.
Who knows what may happen in 2mo. Trump could cark it. then we have Vance to deal with.
gg
Depending on people's circumstances this may be a buying opportunity but it is certainly not a bullish signal. Most commentators including Wyckoff on kitco.com are spruiking as being bullish on 2mo. out futures charts. Spot Gold is falling in price. It may go lower or go higher but chartwise it is more likely to fall further.
Who knows what may happen in 2mo. Trump could cark it. then we have Vance to deal with.
gg
Sdajii
Sdaji
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Downtrend for over two months? That's just silly. It hit an all time high last month, just over a month ago and was in an outrageously upwards trend until 22nd of last month.
Being in a downtrend since then is quite arguable, but it still has not broken the support line which started last year.
The current price would have been an all time high up until a little over a month ago, so saying it's in a downtrend at all is not solid, and to say the overall uptrend has finished doesn't really hold water.
It's in a clear consolidation pattern in a clear uptrend.
Even your own chart on an hourly scale doesn't look like that much of a downtrend. Look on a daily scale and the uptrend is obvious.
Let's look at the daily chart and zoom out two show about the last two years...
If that's not an uptrend it will do until one comes along!
The current consolidation is similar to the one which took place at the end of last year, though it is more obvious and has a much stronger support line. After such a strong run it is hardly surprising to see a consolidation, but the same conditions which caused the clear uptrend still exist - major global economic uncertainty, risk, distrust of FIAT currencies, inflation etc. A bet against gold is a bet that all these things are going to reverse.
I just arrived back in Australia after about a year since my last visit. Supermarket prices horrify me etc. The price of gold sure is running, but the price of groceries is more than keeping up and if I was using gold to buy baked beans or meat or vegetables over the last few years, my gold would be buying less food, which suggests that the price of gold shouldn't be expected to fall.
To play Devil's advocate, the run has been huge, and a pullback may be expected. Interestingly, the technical breakdown target of my pennant coincides with the significant peak we saw in October last year of $2,800 which at the time was a dramatic all time high. Funny that both the breakout and breakdown targets coincide with other relevant figures.
I do think a pullback to $2,800 is entirely possible but even that wouldn't kill the overall uptrend. I think it's much less likely than the upside scenario and it would give an extremely obvious sell signal (the breaking of the support line you can see in my chart) which would allow almost all the drop down to that target anyway, so it seems like a bad move to sell just above that support line.
Bailxtrader
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Here's a educational read with a bit of history. Into US Gold!...
goldbroker.com
Are We Heading for an Explosion of the U.S. and Global Bond Markets? | GoldBroker.com
The year 2025 is likely to be the year of crisis: the United States must refinance $9 trillion in debt — a quarter of its total outstanding — while financing an annual budget deficit of $1.9 trillion. A veritable debt wall. And then ther...
goldbroker.com
Garpal Gumnut
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Well it does look as if Gold is making a good attempt to break up from the recent downtrend and act on @Sdajii 's dodgy bumpy bumpy pennant. . All systems go @Sean K @DaveTrade @mullokintyre @finicky @TimeISmoney @ducati916 @qldfrog @countrylad . Apologies for any golden golders left out.
Remember though, never count your bar until the trend is confirmed. It just lucks ( My speller misspelt looks but it's appropriate ) . Taco Don may change everything on a moronic whim.
gg
. All systems go @Sean K @DaveTrade @mullokintyre @finicky @TimeISmoney @ducati916 @qldfrog @countrylad . Apologies for any golden golders left out.Remember though, never count your bar until the trend is confirmed. It just lucks ( My speller misspelt looks but it's appropriate ) . Taco Don may change everything on a moronic whim.
gg
Sean K
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Well it does look as if Gold is making a good attempt to break up from the recent downtrend and act on @Sdajii 's dodgy bumpy bumpy pennant.
View attachment 200727
Remember though, never count your bar until the trend is confirmed. It just lucks ( My speller misspelt looks but it's appropriate ) . Taco Don may change everything on a moronic whim.
gg
Still stuck in this pennant thing. The longer term trend is up so expect this to break up eventually.
Garpal Gumnut
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The AUD/USD rate does make a difference to returns. Swings and roundabouts. Another factor in buying and selling but too complicated for me to be of any use. I guess if I had multiple screens, more data and was 15 again it would be useful.
gg
gg
Sdajii
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So, on the supposed downtrend on the short time scale, we now have two higher highs and a higher low on the hourly/half hourly. Is that enough to allay the panic or are the short term bears still saying we're in a down trend?
We look like we might be taking a shot at breaking out of the pennant, we're above the resistance line. Of course we need time to confirm a breakout but it's looking good. My target can't get hit soon enough, I did my first grocery shop in Australia in about a year, avoided buying several things because they were too expensive, got to the register remembering buying a similar amount of groceries for about $20, expected more like $50, and it was $75... I think I'll live on potatoes and rice until I leave, and even that might be a stretch of the budget.
We look like we might be taking a shot at breaking out of the pennant, we're above the resistance line. Of course we need time to confirm a breakout but it's looking good. My target can't get hit soon enough, I did my first grocery shop in Australia in about a year, avoided buying several things because they were too expensive, got to the register remembering buying a similar amount of groceries for about $20, expected more like $50, and it was $75... I think I'll live on potatoes and rice until I leave, and even that might be a stretch of the budget.
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Baked Beans & noodles are a Great option ha ha
Garpal Gumnut
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It is SO GOOD to have you back in Australia @Sdajii to put all the wrongs to right, should you have the time. We still don't sell children on the internet as they do in Laos, Cambodia and Thailand, to Australian men and women let it be said, so perhaps wait until you get "home" to Asia to sort that out.
You are correct in saying that your bumpy bumpy pennant is looking bullish again today. The desks must have realised you were back. It has not quite made a high yet on my 3mo. down chart but hopefully the HongKong and London cousins will ally with the fascist Yankee cousins to push gold up over $3400 and then heavenward. I am sincerely wishing you are correct and that I am wrong. However .....
Were I the Head Cousin in China, Mr. Xi Jinping, I'd be having my underlings buying up gold hard in anticipation of the American markets opening tonight and then selling hard US Treasuries and Gold to put pressure on Taco Man ( formerly known as The Donald ) . It has happened before. It is called pump and dump.
In reality though, I trust your judgement, and hope gold continues it's bullish progression. I'll just post my "supposed downtrend", it's not as bumpy bumpy as yours, so please be patient with me who holds a Diploma in Technical Analysis, for all the good it's ever done me.
.gg
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