Gold and its 200 Week Moving Average
I think we can safely assume the Brexit vote is going to fail. This should be bullish for stocks and bearish for the dollar. A falling dollar should be good for gold. However, with stocks and oil moving higher it’s likely to take some focus off gold.
I’m expecting the metals to be volatile for a couple of weeks as they build up the energy to break through the 200 week moving average. I do think gold will ultimately break through once the market recognizes the dollar is in trouble.
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Wow, that didn’t take long.
Just yesterday you said it’s a no brainer this thing will be higher by next week. Now after another 20 dollar drop you are side stepping and calling for a multi week sideways trading…
Gold is just moving down into a half cycle low. Nothing unusual about that.
Remember during the advancing phase of a larger intermediate cycle price doesn’t stay oversold very long before bouncing. I’m guessing right after the Brexit gold will resume it’s upward climb although like I said it’s likely to be erratic because it will be competing with stocks and energy.
Gary, if you’re expecting metals to be volatile for a couple of weeks, is it still a good idea to hold NUGT? Just worried about the decay.
Gary, that mean GOLD is on intermediate cycle not daily cycle, right?
Gold has completed an intermediate cycle low. Once the dollar really starts to accelerate lower after the Brexit vote gold will get busy moving higher.
Mark my words: Before this intermediate cycle is over, gold will at the very least test $1400, and maybe even $1550. The next couple of weeks may churn a bit though.
This is the perfect moment for gold to scare the bulls. Make a big fib retracement. Best is to break 1200. Then scared the hell out of bulls. Then head for 1400-1500
If gold breaks 1200 then it’s all over as that would indicate a failed intermediate cycle. I expect the euro to rally and the dollar to fall after the Brexit and I expect a weak dollar will push everything up just like it did for most of the last 16 years.
From your lips to gold God ears, Chris. But this is blasphemy here.
pending Brexit
then dollar rolls over south
Gary,
Just something to think about and discuss. If there is no Brexit then is it possible that all fear will have been taken out of the markets. Would this not lead to a knocking the wind out of gold’s sails and putting it into the SM? The direction of the markets we are seeing now could be be hinting as to the direction we should go in if we are expecting the stay in EU to win. What could drive the US$ up is the smart money leaving Pound Sterling and going into US$ and EURO.
fb7777, funny you should mention that. I was just reading the same analysis. At the risk of offending anyone here, I am going to post it.
Note: The following is not my opinion; it is a renowned analyst’s opinion. Again, not my opinion. So, the usual caveat here: don’t shoot the messenger please, Gary.
It just goes to show there is definitely drastically different opinions out there on the short term directions of USD and gold. That’s all. Something to be aware of.
” If Britain stays in EU; expect commodities, mainly gold and silver, to plunge. There has been an enormous amount of gold and silver buying over the past two months or so as hedges against a calamity in the EU and Britain leaving. But if Britain doesn’t leave, those gold and silver hedges will get dumped before you can bat an eyelash. Same for mining stocks.
Also, the U.S. dollar will soar. Caught in a months-long sideways trading range, no-Brexit will send the dollar soaring, smashing other dollar-sensitive commodities along the way, everything from oil to soybeans.”
And yes, stocks should SOAR.
According to Larry Edelson today,
expect commodities, mainly gold and silver, to plunge. There has been an enormous amount of gold and silver buying over the past two months or so as hedges against a calamity in the EU and Britain leaving. But if Britain doesn’t leave, those gold and silver hedges will get dumped before you can bat an eyelash. Same for mining stocks.
The U.S. dollar will soar. Caught in a months-long sideways trading range, no-Brexit will send the dollar soaring, smashing other dollar-sensitive commodities along the way, everything from oil to soybeans.
Better to stay sidelines until this storm goes away.
Here’s the thing that everyone is missing. Gold isn’t going up because of fear of Brexit. The market has known for months it would fail. Gold is going up because the dollar is in trouble. The dollar is going to be in even more trouble after the Brexit fails.
Everything is going to go up together.
But like you said, metals would be volatile next two weeks. Wouldn’t it be prudent to stay sidelines and watch the paint dry? It could swing either way, perhaps this gives an opportunity to initiate long positions in Gold and stocks?
So what is your strategy to buy after it has already rallied? Or buy during a correction?
Because if it is the second … well you are getting the correction right now…
Gary….
correction going lower…. yes…????
1215……