Sunday, November 16, 2014

COT Commitments of Futures traders GC Gold Weekly Chart

The red circles show the peaks in gold price over the last year and the green circles show bottoms in gold price. Gold is bouncing right now but the jury is out if the relief rally has legs.

The weekly candlestick chart for gold is agreeable to a sideways to sideways up move for gold into the end of the year. The bars for the COT chart above are lower than the early June and early October lows but not as low as the January low. All four lows, however, are consistent where a bottom should occur for gold price. The bars are sloping towards the center line and have not yet reversed to confirm the upside recovery move for gold bulls so the green circles on the right are tentative. 

A projection would be for gold to base and move sideways to sideways higher to finish the year but in early 2015 commodities in general including oil and copper will have to make a major decision. Either commodities will recover in early 2015 to prove that the global economy is recovering or commodity prices will collapse into global deflation. The universal consensus right now is that global deflation will not occur and the US will never see deflation. If the deflationary scenario plays out in 2015, gold price will fall along with all the other commodities as the world's economy drops down the rabbit hole. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

The COT chart is provided by and annotated by Keystone.

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