A Gold Moment: September 18, 2014
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.
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