Gold Bears Cheer Lower CPI

A Gold Moment: September 18, 2014

Gold Market Expert, Carlos Perez-Santalla

Carlos Perez-Santalla

It was a bad sign for any gold bulls when the CPI was released and prices hardly moved. The market’s anxiety over the forthcoming FOMC statement allowed the bearish camp to leave this headline in reserve for future sighting. Once the Fed’s overly anticipated prepared statement was released then so were the sell orders. Nothing from the statement was dramatically different to expect such a sell-off, nor was there anything that would help drive the USD as high as it went, but the sums of the two headlines for the day were enough to continue the current market perception.  Of course rates are being promised at near zero for a “considerable period”, but now Yellen and Co. are also talking about the inevitable rate increases in outer years.

 

The stock market was not as excited as the USD would have had you believe. An eye should certainly be kept on the money flows to determine whether fund managers perceptions are changing. Could it be that the CPI number was not just the bane of gold bulls as proof of almost no inflation, but a sign of a deflationary period that the Fed may have to battle?

 

Technically, bears have taken control once more. A test of the 1200 mark no longer seems a drastic call. 1218 and 1211 will be support levels on the way to 1204 and 1196. Resistance might be seen near 1236 and 1242 if the downside does not see any more momentum.

 

 Last                       GCZ41219 SIZ41835 PLV41344 PAZ4824

 

 

 

ETF: GLD Deposits:   784.22   tonnes   unch

Comex GC O.I. :  386,080    +551

ETF: SLV Deposits:  10,589.15  tonnes    +29.83

Comex SI O.I.:  171,260   +124

 

GC/EU                                  950

GC/SI                                    66.11

PL/GC                                   1.1029

GC/WTI                                13.14

 

 

 

Carlos Perez-Santalla

Gold and the FOMC Dance

A Gold Moment: September 17, 2014

 

Gold Market Expert, Carlos Perez-Santalla

Carlos Perez-Santalla

Gold traders were mixed on direction but not reason yesterday. Spot gold chopped between 1232 and 1242 before settling into the middle of that range ahead of the FOMC statement. This is to be released today at the end of their two day meeting. The PPI figures released early were not friendly to bulls as expectations were met. The Redbook retail measure gave bears a little fright as figures were disappointing. A London closing short covering rally was halted as TIC flows gave the USD more to cheer for. Considering some of the strength in the USD is coming from the weakness in GBP from the Scottish independence referendum, a negative outcome from that vote could weigh on the USD and find friends in gold. Of course, a hawkish FOMC statement is already cooked into the price. Any unexpected dovish leaning and gold bulls may have a chance.

 

Technically, recent price indecision has taken dominance away from bears and given bulls a chance. That chance is based on a break above 1240 delivering a test to trigger buy stops near 1246 with a resistance goal of 1255. Of course if that chance is not taken, trading under 1228 will send spot gold to 1218 on the way to 1204 .

 

 Last                       GCZ4

1238

SIZ4

1867

PLV4

1368

PAZ4

846

 

 

 

ETF: GLD Deposits:   784.22   tonnes   -4.18

Comex GC O.I. :  385,529    +4682

ETF: SLV Deposits:  10,559.32  tonnes    unch

Comex SI O.I.:  171,136   +431

 

GC/EU                                  956

GC/SI                                    66.07

PL/GC                                   1.1058

GC/WTI                                13.22

 

 

 

Carlos Perez-Santalla

Gold Holds on Weaker Industrial Numbers

A Gold Moment: September 16, 2014

 

Gold Market Expert, Carlos Perez-Santalla

Carlos Perez-Santalla

In the midst of a short covering rally gold prices got some support from the US Industrial Production number which came out worse than expected. It wasn’t just worse; it was negative for the first time this year. Coupled with a lower capacity utilization number, hopes for an improved US employment picture faded.  These figures are not enough to change the market’s expectations of rate increases from mid to late next year, but it is enough to spark doubt for the start of these increases. Anymore negative economic measures may see some gold bears run for cover, temporarily. Today’s PPI and TIC numbers may have some clues.

 

Technically, intraday charts are mixed with the daily showing upside potential. A close above 1241 today could deliver a test of 1257.

 

 Last                       GCZ4

1242

SIZ4

1882

PLV4

1370

PAZ4

840

 

 

 

ETF: GLD Deposits:   788.40   tonnes   unch

Comex GC O.I. :  380,847    -1846

ETF: SLV Deposits:  10,559.32  tonnes    unch

Comex SI O.I.:  170,705   -1643

 

GC/EU                                  957

GC/SI                                    65.99

PL/GC                                   1.1031

GC/WTI                                13.52

 

 

 

Carlos Perez-Santalla

Gold Under USD Pressure

A Gold Moment: September 15, 2014

 

Gold Market Expert, Carlos Perez-Santalla

Carlos Perez-Santalla

Money managers have turned their backs on gold with few triggers for any long term rally on the horizon. The USD strength continues as US equities remain the surest place for monetary safety. The expectation for a rate hike by the Fed by mid-2015 is still the overall perception of the market and this is better than the alternatives. The latest factory output numbers out of China are a reminder that the PBOC will likely continue to behave in a more accommodative way.  Just another reason for USD strength.

 

The dollar strength will be the overarching theme for traders until any trade or money flow disruption comes out of the geopolitical battles. The latest out of the trouble in Ukraine has seen an increase in sanctions that are getting closer to doing just that. What the Russians do in retaliation to this new wave may, at minimum, affect Europeans. This will be especially troublesome going into winter months as Russian supplies of natural gas may play a role.

 

Technically, the daily chart shows the market to have overextended the downside move. A bounce is likely in the works, but it will be unlikely to be more than that as all other time frames remain bearish. A break above 1238 could send spot to test the 1247-1250 level. Resistance should be challenging at that point. A close above 1256 would be needed to see prices turn to favor bulls. The downside has the allure of 1200 keeping the focus of the shorts.

 

 

 Last                       GCZ4

1238

SIZ4

1869

PLV4

1375

PAZ4

849

 

 

 

ETF: GLD Deposits:   788.40   tonnes   unch

Comex GC O.I. :  382,693    -1977

ETF: SLV Deposits:  10,559.32  tonnes    +104.42

Comex SI O.I.:  172,348   +6268

 

GC/EU                                  955

GC/SI                                    66.27

PL/GC                                   1.1100

GC/WTI                                13.64

 

 

 

Carlos Perez-Santalla

Gold Anticipates FOMC

A Gold Moment: September 12, 2014

 

Gold Market Expert, Carlos Perez-Santalla

Carlos Perez-Santalla

The world of gold is less relevant to money managers as more economic measures are released. Yesterday’s weekly jobless number remained as stable is it has been for many weeks. This perception has persisted since the July Fed meeting, making the statement to come from next week’s FOMC meeting more powerful. In the unlikely case that the statement warns of weakness and proves to be extra dovish, gold prices might reverse the current direction. The expectation is for more of the same giving traders more room for belief in a rate increase by mid-2015.

 

The geopolitical picture continues to be full of posing and speaking, The Russian reaction to Obama’s speech was as expected as the details of the president’s plan. None of these headlines will affect gold pricing. That is until the actions begin to affect world trade. All parties in these conflicts seem to be very keen on how to pay for their battles and are careful not to hurt money flows lest they gain new enemies.

 

Technically, the intraday short term charts are neutral with the daily oversold. The upside has room up to 1255 without erasing the bearish control. A break and close below 1231 could deliver a deeper slide to test 1200 next week. Support established back in January/February sits between 1232-1236. Any hope for bulls currently sits  with an unlikely close above 1256.

 

 

 Last                       GCZ4

1238

SIZ4

1860

PLV4

1363

PAZ4

835

 

 

 

ETF: GLD Deposits:   788.40   tonnes   -0.32

Comex GC O.I. :  384,670    +329

ETF: SLV Deposits:  10,454.90  tonnes    +46.24

Comex SI O.I.:  166,080   +799

 

GC/EU                                  958

GC/SI                                    66.47

PL/GC                                   1.1000

GC/WTI                                13.30

 

 

 

Carlos Perez-Santalla

Gold Sliding on Improving Rates

A Gold Moment: September 11, 2014

Gold Market Expert, Carlos Perez-Santalla

Carlos Perez-Santalla

A gold trading day has passed with little change in perceptions. Yesterday’s anticipation of President Obama’s speech for his view on the ISIS crisis was very muted. Last night’s reaction to his declaration of planned airstrikes in Syria was welcomed in lukewarm fashion.  Until any of these geopolitical battles affect trade or money flows, gold traders will treat them like no threat at all. The US wholesale inventories number continued the wave of positive economic measures to be released over the past few weeks. This is seen as more important to money managers who are measuring gold’s value against the value of money. Rates saw a small improvement again tarnishing gold’s allure.  The day the jobs picture catches up with the positive economic measures will certainly be a weak day for gold prices.

 

Technically, the intraday short term charts are oversold. A bounce or extended sideways move may be in the works, but it will be short lived if spot gold prices don’t reach and stay above 1244 for an extended period. The daily is a touch oversold as well. Support established back in Jauary/February sits between 1232-1236.  A break above 1244 could see a return to the mid-1250s, but not much more.

 

 

 Last                       GCZ4

1246

SIZ4

1873

PLV4

1374

PAZ4

846

 

 

 

ETF: GLD Deposits:   788.72   tonnes   +3.00

Comex GC O.I. :  384,341    +1166

ETF: SLV Deposits:  10,408.66  tonnes    -0.10

Comex SI O.I.:  165,281   +684

 

GC/EU                                  962

GC/SI                                    66.44

PL/GC                                   1.1052

GC/WTI                                13.67

 

 

 

Carlos Perez-Santalla

Gold Back on Rate Watch

A Gold Moment: September 10, 2014

Gold Market Expert, Carlos Perez-Santalla

Carlos Perez-Santalla

Gold traders are sticking to the old adage that “the trend is your friend” and they are benefitting from it. With money managers pouring their money into equities with a general belief that the US economy is healthy, gold is losing any new investor attention as prices drop against the continued strength of the USD. It seems with the ECB, PBOC and the BOJ all leaning towards continued easing, the Fed seems to be the only central bank discussing tightening. This expectation of a rate increase is boosting the USD as a safe trade. Real rates will remain a key for the gold market. They have stabilized over the past couple of months, but they are so close to zero that the picture could change in short order.

 

 

Technically, bears are holding steadily. The steady accumulation between 1241-1246 that occurred in June is viewed as good support. A break through this level does not promise too much of immediate downside with 1231-1234 as support.  At the same time any rally that could break 1258 gives the market a chance to test 1268.

 

 Last                       GCZ4

1254

SIZ4

1905

PLV4

1385

PAZ4

862

 

 

 

ETF: GLD Deposits:   785.72   tonnes   unch

Comex GC O.I. :  383,175    +5244

ETF: SLV Deposits:  10,408.76  tonnes    +44.75

Comex SI O.I.:  164,597   +96

 

GC/EU                                  967

GC/SI                                    66.85

PL/GC                                   1.1044

GC/WTI                                13.52

 

 

 

Carlos Perez-Santalla

Gold Losing Favor with Money Managers

A Gold Moment: September 9, 2014

 

Gold bulls have been losing battles consistently. Despite the ECB statement of easing, despite the weaker than expected US employment picture and despite the deeper than expected Japanese negative GDP bears still have a grip on money managers. The general argument is that gold must be weak because it is not reacting positively to the trouble in Ukraine, the ISIS crisis or any of the others on a long list of violent situations in the world. Another argument is that the US is stable hence the US stock market is reflecting this strength and the general level of comfort.

 

The ECB and Japanese economic situations that will drive further easing is being viewed in the gold trading world as a positive for the USD. It is also being viewed that easing did not weaken the USD, so any expectation of inflation based on easing must be false.

 

The US employment apologists, almost immediately after the NFP release, have been pointing out all they can to distract those who see the numbers for what they are. This comforts those who had a level of worry based on the mounting evidence of a stagnant jobs picture.

 

It has been stated here often that the geopolitical pictures should have no effect on gold prices until they threaten trade or money flows. The main participants in the recent wave of fighting seem to be very aware of limiting economic impact so as not to hurt themselves in their goals and to limit the number of people who would be willing to fight them.

 

Is the stock market reflecting a stable economy or is it the best place for money growth in a desert of investment choices? US corporations are swimming in cash fed to them by all the easing, but they are afraid to repatriate the cash in an effort to avoid taxation. Until this pool of money gets put back into the economy, stagnation will dominate and gold will be viewed as a relic by many who favor equities.

 

Technically, there is no question as to the direction in which the market continues to move. Bears are still in control. The last time prices traded under 1252 in June, prices held steadily with accumulation between 1241-1246.  With indicators in intra-day and daily charts showing a potential oversold situation, the downside is limited for the next couple of days with a chance of a pop to test 1268. Resistance above that still sits at 1272, 1278 and 1284. A close above 1278 is needed to spark a bull move.

 

 Last                       GCZ4

1258

SIZ4

1906

PLV4

1399

PAZ4

886

 

 

 

ETF: GLD Deposits:   785.72   tonnes   unch

Comex GC O.I. :  377,931    +820

ETF: SLV Deposits:  10,363.91  tonnes    unch

Comex SI O.I.:  164,501   -736

 

GC/EU                                  975

GC/SI                                    66.05

PL/GC                                   1.1114

GC/WTI                                13.68

 

 

 

Carlos Perez-Santalla

Gold on Hold Ahead of NFP

A Gold Moment: September 5, 2014

Gold Market Expert, Carlos Perez-Santalla

Carlos Perez-Santalla

Gold bears continue to dominate the mood of the trading environment. The threat of action to mitigate the ISIS crisis by the US and UK has lost any influence on gold pricing that it may have once had. The trouble in Ukraine also has some news that would have supported prices in the past. Money managers certainly will not ignore headlines from these geopolitical tensions. Until these conflicts affect trade and the flow of money, gold traders will look the other way.

 

The jobs numbers that came out yesterday were released fairly close to expectations and so had little effect on prices. This has kept the enthusiasm for a stable NFP today. The big surprise yesterday that gave the stock market and the USD their strengths and gave gold a bit more weakness came from the second ISM measure of the week. The non-manufacturing measure came in the highest it has been in well over a year. This figure coupled with the ISM manufacturing  number from earlier in the week bolsters the view that the Fed will be tightening by mid-2015.

 

Technically,  bears are still in control. 1258 has been reached and remains a bargain hunters level. 1252 is the next support level on the downside with 1244 not far behind. Should any buying turn the market around, resistance will be met at 1272, 1278 and 1284. A close above 1284 is needed to spark a bull move.

 

 Last                       GCZ4

1266

SIZ4

1912

PLV4

1408

PAZ4

889

 

 

 

ETF: GLD Deposits:   785.72   tonnes   -4.79

Comex GC O.I. :  368,523    -2992

ETF: SLV Deposits:  10,363.91  tonnes    unch

Comex SI O.I.:  161,805   -502

 

GC/EU                                  976

GC/SI                                    66.27

PL/GC                                   1.1113

GC/WTI                                13.38

 

 

 

Carlos Perez-Santalla

Gold Holds Ahead of Employment Numbers

A Gold Moment : September 4, 2014

Gold Market Expert, Carlos Perez-Santalla

Carlos Perez-Santalla

Gold price moves yesterday lost some attention as many metal traders were focused on their PGM positions that were being affected by the potential peace breaking out in Ukraine. This potential deal has not affected gold as money managers had already discounted any price move potential over the past few weeks. The other discounted geopolitical activity has been the growing strength of the ISIS group. Now President Obama and Prime Minister Cameron have come out and jointly announced a plan to push back against this aggression and make sure they are not an ongoing threat.  Unless these new plans create a more dangerous and trade disrupting situation, money managers will not be running to the golden safe haven.

 

Economic figures have been the focus for price forecasting for many weeks now. Yesterdays biggest headlines came from the Beige Book. This is now the third month in a row that shows the US economy at a stable to improving pace, despite struggles with employment. Today will deliver the ADP figure, as well as the weekly jobless number, giving a hint to tomorrow’s holy grail of numbers, the NFP. Only a major divergence from the expectations will move gold as perception has the Fed ending QE next month and rates increases beginning mid-2015. Any change in that perception will surely shake up volatility.

 

Technically, although gold prices were stable yesterday, bears are in control. 1262,1258, and 1252 are the next support levels on the downside. Should any buying turn the market around, selling should be seen at 1272, 1278 and 1284. A close above 1284 is needed to spark a bull move.

 

 Last                       GCZ4

1271

SIZ4

1922

PLV4

1412

PAZ4

886

 

 

 

ETF: GLD Deposits:   790.51   tonnes   -2.69

Comex GC O.I. :  371,515    +6400

ETF: SLV Deposits:  10,363.91  tonnes    -7.44

Comex SI O.I.:  162,307   +657

 

GC/EU                                  968

GC/SI                                    66.16

PL/GC                                   1.1100

GC/WTI                                13.37

 

 

 

Carlos Perez-Santalla