Gold Prices Catapult, Signal Change.

CTM061914Technical Read: The uptend detected earlier proved to be a catapult for gold prices as nervous bears ceased selling and rising prices triggered buy stops (i.e. more buying) leading to a hyperbolic one-day price move. The action triggered a “exit-Long” signal for the model portfolio today, moving it to neutral (aka “flat”). Please be advised an “e-L” does not mean the uptrend has reversed but does indicate 2 events. A) The model portfolio is now neutral and B) the risk/reward ratio is no longer favorable for a bullish position. No GLD watcher should be mystified at an exit after a daily net-change of over $4.25. This was an excellent (profitable) ending for the June 5 entry. Taking a profit is generally a good thing. The mummy got thumped.

What is next now? The bears were simply routed as we approached a weekend with increasing signs that things are not going well for the government in Bagdad (i.e. reports of ISIS flags flying over a “key” refinery and  US military advisors gearing up for deployment). We will continue to monitor events, being “flat” can be a good thing if gold becomes overly news oriented here.

Gold advances off recent lows

Technical Read: Prices are advancing off the closing low of June 2 and the bullish model portfolio change (June 5). Previous oversold market provided support for the bulls. Trading action on June 15 was disappointing but not a trend change yet.

What is happening now? Problems in Iraq are providing most of the buzz though there are questions as to just how much of an oil disruption is ahead. To people who lived through the Vietnam era, the rapid advances of the “ISIS” group rings a bitter bell of remembrance of how quickly South Vietnamese forces caved in the face of the last North Vietnamese big push. Anyway, the news backdrop is supportive.CTM0616