Gold Chart of the Week

Each week will be providing us a chart of the week as analyzed by a member of their team. We hope that you enjoy and learn from this new feature.

WEEKLY GOLD SERIES (August 27-August 31)

After three months of a painfully rangy trade, Gold Bugs were finally rewarded for their patience. Last week, after December Futures traded above $1630, the technical buy was on. Not only did the futures price test the 200 day moving average (what I suspected would be the short term target), it traded straight through before finally topping out over twenty dollars an ounce higher!  Furthermore, we begin this week with Gold printing another new high overnight.

It seemed last week that Gold prices were once again trading the fundamentals that once dictated direction. Here are a few factors that were baked into last week’s rally:

FOMC announcement that stated “many members” would support further  stimulus if the economy did not show sustainable positive results.

Potential for a major “accommodative” approach from the ECB upcoming

Reports of large bullion purchases in Europe, China, and India

Anticipation of this week’s Jackson Hole Symposium producing a major announcement that would affect global markets

This week is fairly light on economic news that would produce anything close to Ben Bernanke’s speech from Jackson Hole on Friday. From this same event in 2010, QE2 was announced and in 2011, Operation Twist was laid out. There is speculation that the FOMC’s “supportive stance” last week proves that the US will again announce a large scale idea after concluding.  All eyes will be on this announcement and traders will stand ready to act. If the meeting provides nothing new to the market, one would expect most of the anticipatory buying to turn into heavy liquidation until Europe finishes their meetings the following week.

I expect this week to stay light in volume with a choppy trade until we have a final decision from Jackson Hole, Wyoming at the end of the week. Once a decision is final, the directional trade should be back in play.



Good luck this week in the markets. And please feel free to call or email my office. As a Senior Market Strategist with Long Leaf Trading, I advise customers in the futures markets and welcome any input from fellow traders. I can be reached toll free at (888) 272-6926 or by email at [email protected]

Thank you for your interest,

Brian Booth

Senior Market Strategist

[email protected]


4 thoughts on “Gold Chart of the Week

  1. Dear Market Club

    I am concerned about recent inaccuracies in your data feeds.
    Yesterday Monday Nov Soyoil traded above 1760. Your charts show a high of 1744.
    If I had relied on your chart, I was vulnerable to a risky and costly trade.
    Today your chart showed a 60c move in silver from 30.60 to 31.10.
    This was inaccurate, and has left me in a silver contract without the correct information

    In addition, the feeds for SOYOIL, SOYBEANS and WHEAT seem to come through several hours (a day) late.

    Please lift your game.


  2. Well, TWIST expires at the end of the year so the FED is very unlikely to announce any new QE until maybe March.

    The markets will most likely be marked by distribution for the rest of the year, especially since higher tax on capital gains is looming in the new year and thus there will be increasing incentive to sell for the remainder of this year.

  3. Nothing like some massive naked shorts to drop the price. However, this only allows buyers to take delivery at bargain basement prices! And one of these days, the big banks with years of silver production shorted to infinity and beyond (in conjunction with QE), they are going to run out of allocated accounts and ETFs to steal the metal from. They might even wind up in court, at least in some countries, where they will be held to account.

    And then . . . the thieves may just have to purchase the real deal, actual honest to God metal, on the open market, in order to restore those tens of thousands of tons of gold and silver they have "borrowed" during the last decades, while the crooks were in charge, assisting with the thefts.

    Guess what that will do to the price?

  4. The bullion banks are going short against allmthe new longs in the market. It seems to me that the way the Bernank is going to go is to hold for now. This will allow the bullion banks to manipulate the pm's silver more than gold. Look out for a big hit on the silver market Friday.

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