LaSalle's Nedoss: Comex Gold's Technical Posture Improves
Gold’stechnical-chart picture has improved, and the December futures potentiallycould challenge the 100-day moving average around $1,238.10 an ounce in thenot-too-distant future, says Charlie Nedoss, senior market strategist withLaSalle Futures Group. The most-active Comex contract hit a 10-week high of $1,230 anounce on Thursday, although it has pulled back some to $1,225.30, down $2.30for the day, as of 9:43 a.m. EDT. “I wouldn’t be surprised early in the week tosee some back and fill,” Nedoss says. Nevertheless, he continues, the markethas developed good chart support in the area around $1,203 to $1,204, near acluster of moving averages. Further, he points out gold this week so far hasfirst taken out last week’s low and is now above last week’s high. If thisholds through the close, this would be known as a weekly outside reversalhigher, which is considered technically bullish. Plus, the metal is headed forits first close above the 10-week moving average since April, Nedoss says. IfDecember gold can get above the $1,238 area, he concludes, “there is not muchresistance above the market.”
By Allen Sykoraof Kitco News; asykora@kitco.com
Aberdeen: Gold Would Benefit From More Stock-MarketVolatility
Friday October 12, 2018 10:16
Maxwell Gold, director of investment strategy withAberdeen Standard Investments, says further stock-market volatility and thelarge bearish position of speculators in gold futures could mean another pricerise should those metals traders be forced to buy to exist from their trades.U.S. equities fell sharply Wednesday and Thursday, before getting a bounce inearly trade Friday. Investors flocked to so-called safe-haven assets such asgold as the VIX volatility index soared to its highest level since the firstquarter. “Given the current negative sentiment andlarge short positioning in the futures market for gold, further equityvolatility could provide the much-needed catalyst by sparking a short squeezein the short term,” the strategist says. “Historically, periods of elevated VIXlevels have favored gold and platinum....” Further, Gold says investors are“underweight” in the metal right now. “Historically, when the S&P 500suffered a peak-to-trough drawdown of 15% or more, gold has been the clearbenefactor...,” he says. “Despite higher U.S. interest rates, this in turn thiscould help gold resume its current uptrend, which began in December 2015 inalignment with the start of the current Fed tightening cycle.”
By Allen Sykoraof Kitco News; asykora@kitco.com
FXTM:Gold Bulls Remain In ‘Driving Seat’ Above $1,213/Oz
Friday October 12, 2018 09:40
Gold bulls remain in charge of the market’s near-termdirection as long as prices remain above previous resistance that failed at$1,213 an ounce, says Lukman Otunuga, research analyst at FXTM. Otherwise, he adds,the longer-term outlook remains bearish. Global risk aversion and a softerdollar sent spot gold to a 10-week high above $1,225 an ounce on Thursday. “Although gold prices are noticeably weaker this morning,bulls remain in the driving seat above the $1,213 level,” Otunuga says. “Whilethe technical outlook points to further upside, fundamentals are still in thebear’s favor. With the dollar supported by safe-haven flows and prospects ofhigher U.S. interest, the medium- to longer-term outlook remains negative forgold.” Technically, gold turned bullish on the daily charts following abreakout above the $1,213 resistance level, the analyst continues. “Investorsmay utilize $1,213 as a fresh support to push prices towards $1,228.20 and $1,233.50,”Otunuga says. “If prices unable to keep above the $1,213 [level], gold hasscope to depreciate back towards the $1,200 psychological level.” As of 9:13a.m. EDT, spot gold was $5.45 softer at $1,219.30 an ounce.
By Allen Sykoraof Kitco News; asykora@kitco.com
Commerzbank:Short Covering Could Add Further Fuel For Gold Rally
Friday October 12, 2018 09:40
Goldposted its biggest gain Thursday since the Brexit vote in June 2016, and shortcovering could send the market even higher, says Commerzbank. The preciousmetal added 2.5% Thursday in U.S. dollar terms. “Gold ineuros likewise gained significantly, climbing for a time to nearly ?,?1,060 pertroy ounce,” the bank says. “The price rise was supported by a weak U.S. dollarand falling bond yields, though we believe gold is likely to have received itsbiggest boost from short covering.” Data from the Commodity Futures TradingCommission shows that money managers had a net-short, or bearish, position of 79,603 futures contracts as of Oct. 2. “This equates to 247 tons of gold,” Commerzbank says. “If thisentire quantity were to be bought back, the gold price would no doubt increaseconsiderably. Perhaps a start was made yesterday. Market participants do atleast appear to have become somewhat more risk-conscious again following thesharp falls experienced by stock markets and the associated noticeably highervolatility.”
By Allen Sykoraof Kitco News; asykora@kitco.com
RBC’s Gero: GoldRetreats As Equities Recover
Friday October 12, 2018 09:40
Comex gold is giving back some of its stronggains from the past two days, during which equities took a beating, withtraders now exiting positions in the precious metal ahead of the weekend, says GeorgeGero, managing director with RBC Wealth Management. As of 9:20 a.m. EDT, ComexDecember gold was $3.80 lower to $1,223.80 an ounce. Gero attributes thepullback to a rebound in the stock market and expectations that the FederalReserve remains on schedule to hike U.S. interest rates. The metal rose sharplyon Wednesday and Thursday amid sell-offs in the stock market. “Event-driven rallies [ingold] usually are short lived as event-driven sell-offs also encounterevening-out trades,” Gero says. “My 35 years on the floor have seen all thisbefore.”
By Allen Sykoraof Kitco News; asykora@kitco.com
MKS: 100-Day Average Provides Chart Resistance For Gold
Friday October 12, 2018 09:40
The strength in gold prices the last two daystook the market near its 100-day moving average, which offers chart resistance,with the metal subsequently pulling back, says MKS (Switzerland) S.A. Spot goldtraded to a 2.5-month high of $1,225.40 Thursday, although as of 9:05 a.m. EDTFriday, was down $5.90 to $1,218.85 an ounce. “In Asia today, gold opened at$1,223 and drifted lower with the SGE [Shanghai Gold Exchange] premium softerat $2-3 over loco London,” MKS says. The market later bounced from the lows.“Gold is trading fairly close to the 100 DMA at $1,228. There should be plentyof resistance but a close above that level could signal a move higher,” MKSsays. “On the downside, we expect solid buying interest between $1,205-10.”
By Allen SykoraFor Kitco News
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asykora@kitco.com Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.