Today's action in the gold market was truly telling. It was even a good tell for the selling in the broad markets. 8:20am; the comex opens and half a billion in notional contracts were dumped on the market; just for gold to rebound at 9:30AM full reversal. This all just wreaks of absolute desperation in a massive chess game of confidence between the market and the real market (the unrigged one).An interesting note to watch for strength of this rebounce off that smash is the the DX (dollar index); The DX didn't move significantly around that time. I believe last time I saw this action in gold we retraced it all to prior the "large seller". Noted for future reference.
And the 30 week moving average is still in charge. 15 weeks* now and not a weekly close below. My continued positioning is that the gold market bottomed on 12/31/13 and the equity markets topped (relatively speaking +/- a few percentage points here in the larger picture will be so irrelevant). There's a solid stream of reliable sourced news in the gold community that depicts a great fundamental story for the supply and demand of the market. The probabilities of this being the bid we've seen against these large unorthodox "larger sellers" has to be fairly significant in this market. Quite obvious the investing community is spooked about anything to do with gold after the April 2013 12% drop. This is the pure adage of 'buy fear, sell greed.'
I don't think we'll see gold accelerate off the 30 week moving average until gold trends back over 1400 and then investors will flock in and we could veer off and upward for a time; but we'll always look back and see where steady eddy 30WMA is hanging out to keep our heads cool.
Till next time on the Gold Market.
Technical check up using Stokes:
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