PM Daily Market Commentary – 8/1/2017
Gold fell -0.50 to 1274.90 on moderate volume, while silver dropped -0.12 to 16.70 on moderate volume. The buck staged a modest rally; this didn’t seem to affect gold, but it did seem to affect both silver and copper, both of which sold off a bit today.
Gold tried both directions today – it fell fairly sharply just after 8am Eastern, then broke out to new highs (1280.30) around 10am, but ended the day more or less back where it started. Candle print was a long-legged doji, which the candle code gave a 43% chance of marking a top. RSI7 for gold is 77, which is somewhat overbought. The gold forecaster fell -0.12 to a rating of +0.50 – still bullish, at least for now anyways. Gold remains above all 3 moving averages.
Open interest at COMEX for GC fell -2,686 contracts.
Rate rise chances (Dec 2017) remains at 43%.
Silver did not do nearly as well; it did not make a new high, sold off fairly hard, bounced back, but then faded into the close. Candle print was a bearish engulfing, but the code did not see this as a reversal; neutral rather than bearish. Forecaster was not so positive, dropping -0.30 to +0.20. Silver remains above both the 50 and the 9 EMA lines. It is possible that silver’s weakness could be attributed to a weakness in copper also.
Open interest at COMEX for SI rose +862 contracts.
The gold/silver ratio rose +0.52 to 76.36. That’s bearish.
Miners tried to rally today but the rally failed. GDX printed a high wave, which the code felt had a 43% chance of marking the high. GDXJ looked quite similar, also printing a high wave, which the code felt had a 41% chance of marking a top. GDX’s forecaster dropped -0.14 taking the rating down to +0.13, which is just barely bullish. It looks as though the miners may be about to reverse direction, but we will need confirmation to be certain. Miners have been chopping sideways for the last few days. It feels like they’ll be picking a direction soon.
The GDXJ:GDX ratio fell slightly, while the GDX:$GOLD ratio fell more substantially. That’s bearish.
Platinum rose +0.47%, palladium rose +0.88%, while copper fell -0.59%. Copper printed a swing high, which has a 57% chance of marking the top, while palladium and platinum continue to move higher
The buck rose +0.18 to 92.82, printing a bullish harami candle pattern which has a 50% chance of marking a low. The dollar’s forecaster wasn’t as impressed, rising just +0.07 to read a still-bearish -0.54. We have seen a bunch of 40-50% candle reversal patterns all the way down; I’m waiting for a swing low.
Crude was smashed, dropping -1.38 to 48.79. Crude started dropping during the London trading session after a report suggested that OPEC exports had increased 388k bbl/day in July. Crude did bounce back, only to head lower after hours when the API report showed a surprising and bearish crude inventory build of 1.8 mbpd. Crude’s candle print was a bearish engulfing, which had just a 35% chance of marking the top. The forecaster felt it was much more serious, dropping -0.76 to just +0.26 which is still bullish – for now. Crude remains above its 9 EMA, but fell below the 200 after today’s move down.
SPX rose +6.05 to 2476.35. Today’s print was a doji which the code felt was neutral. Financials led (XLF:+0.72%) while industrials did worst (XLI:-0.29%). I can’t figure out where SPX is headed. The market looked for a time as though it was ready to correct, but now I’m not so sure.
VIX fell -0.17 to 10.09.
TLT jumped higher, rising +0.48%. TLT opened much lower and rallied strongly all day long, printing a bullish strong line on the day which is a 63% chance of marking a low here. Bonds have probably put in a low.
JNK fell -0.27%, printing a low-rated swing high (just a 38% chance of marking the top). In spite of that rating, JNK does look fairly unhappy right – it is signaling risk off.
CRB fell -1.03%, also printing a swing high. 3 of 5 groups fell, with agriculture being the biggest loser. The fall in energy prices didn’t help too.
The buck is hinting at a possible reversal; it is heavily oversold. Miners and gold are also looking a bit weak. However, we still need confirmation; we have seen no reversal just yet.
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Move in the Euro is just relentless: a new high to 118.83, up +0.69% on the day. GLD is up +0.13% but GLD:$XEU is down -0.56%. GLD chart looks great in dollars, but lame when viewed in Euros.
I'm just guessing that the unrelenting Euro strength has to do with Trump's political weakness vs Europe's "relative calm prevails."
If the dollar and euro reverse, gold will fall in dollars but probably look better in Euros. Then we can say that the gold rally in dollars sucks. It kind of sucks now anyway. Dollar is plunging lower and gold is barely hanging on/inching higher (not today though).
DXY is climing into the close, but still negative on the day. Looking at Kitco, gold never made it positive, I don't think. Mining shares suck. I wonder how many years it will take for them to bottom out and then rally for real?
The Kangaroos are bouncing again in Australia…That's clearly the only explanation for these dramatic AM moves.
I think they're definitely starting to wang the market around right now.
Whoever "they" are.
Tonight at 7pm we saw a $10 down-spike on 8500 contracts traded in gold on a 5-minute bar. That's a pretty big move.
Feels like someone might be trying to trigger a top, perhaps. Certainly the recovery off the spike doesn't look all that exciting. I think its starting to become a bit dangerous to be long.
The ""markets"" for gold and silver are as relentlessly under the control of the bots as ever.
Someone whangs them around at will. Must be fun to feel and be that powerful.
It all works until it doesn't, and then the tears start, or the rules are changed to protect the guilty.