Model Gold Portfolio: Neutral, last signal 12/01 “exit long”

Technical Read: Gold looks to be forming a new trading range based on the recent high/low established over the last 4 trading days. Using the GLD ETF as a proxy, the range would be 117 to 112 (approx.) Today’s closing price of 116.33 puts the indicator near the high end of the range. Can it push further north now? Technically, probably not.

Backdrop:

• Catalyst 1 – The US dollar is breaking out of its trading range. Global growth problems in Japan and Europe are looming factors. A resumption of the dollar uptrend is negative for gold. With gold near-term overbought, this should argue against gold going much higher.
• Catalyst 2 – The S&P 500 rallied the last two trading session. This makes it seem like big-cap equities are not ready to roll-over yet. Mildly negative for Gold.
• Catalyst 3 –The world watches as crude prices plunge lower, below the psychologically important $70 level. Expectations are for US output to increase during 2015. Can OPEC rally to put the breaks on the slide? Sunni/Shite relations are not high. This is negative for commodities in general, and gold as well.
• Bond Trading Signals. I am offering a similar Mummy process for Treasuries. See the “Bond Trading Signals” tab for more info.

GH Garrett – Veteran Commodity Watcher for ConquerTheMummy.com