What the Russell Death Cross means to Gold
A storm is comingin the equities markets and the first sign of a equity rain cloud is the deathcross that is hanging over the Russell 2000. This occurs when the 50-day movingaverage (DMA) crosses below the 200 DMA to the downside (see chart below). Ibelieve a break in the equities could be the catalyst that pushes gold through $1246/ozand powers it up to the 200 DMA at $1276/oz. Now recently several Fed officialshave changed their tone to a more dovish stance. This is a result of thesoftening housing data from their over tightening in interest rates. While Iexpect the Fed to raise rates in December, this should lead them to disappointin 2019.
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Daily Chart Analysisand Price Outlook
December E-miniRussell 2000 Chart
December Daily GoldChart
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Analysis and Outlook
Looking at the daily December gold chart which has beenmostly trapped in a trading range for the last 4 months, needs a catalyst tobreak through the $1246/oz. What you want to see is stochastics push up over 75while the MACD is positive. In addition, you would need the ADX (which measuresstrength of the trend) to break up above 25. This combination should providegold with the technical setup to challenge the 200 DMA.
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By Phillip StreibleContributing tokitco.com
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pstreible@rjofutures.comwww.rjofutures.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.  |