Bulls Ahoy

Model Gold Portfolio: Now: Long (Bullish), Previous signal: Neutral (1/13)

CTM150127Technical Read: Nonlinear trading analysis readings are pointing to higher prices in gold. The model portfolio is now long (bullish). In technical terms, the yellow metal broke out of its trading range on Jan 15, powered by an unusual disruption in the currency markets (the Swiss franc was ground zero). The recent pullback (23rd and 26th) failed to pick any follow-through selling. Another leg higher is likely.

Backdrop:

  • Catalyst 1 – The S&P 500 tumbled down 27 ½ points in the aftermath renewed concerns that Greece will seek concessions (Prime Minister Tsipras’ election is the catalyst for this) to reduce the country’s indebtedness and possibly ease up on the austerity. The two goals don’t seem to mesh unless the bond holders take a haircut. Anyway, I’m not sure today’s move signals a down trend in big caps yet. Neutral for gold.
  • Catalyst 2 –The US dollar index sold off as the bulls got a little ahead of themselves (something all traders have to watch for, no matter how pronounced the trend). There are a lot of poles out there, stuck in the ground, with various heads of traders-gone-by adorning the tops. Any dollar moderation is positive for gold however the technical damage to the dollar was not great.
  • Catalyst 3 – This week marks the 70th anniversary of the liberation of Auschwitz (an infamous death camp, for the under 30 crowd). The ponderable is: Can something like this happen again? If a government gets too much power, I would say yes.
  • Bond Trading Signals. I am offering a similar Mummy process for Treasuries. See the “Bond Trading Signals” tab for more info. Currently available.
  • Currency Trading Signals. I will be offering a similar process for currencies (the US Dollar, plus one more) after Jan 31.

GH Garrett – Veteran Commodity Watcher for Conquer the Mummy .com “Nonlinear signals that matter in gold trading.”

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