The MasterCharts: #Gold - The crowd still too bullish
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Gold & Silver 24 hr Spot

24 Hour Spot Gold 3-Day Overlay 24 Hour Spot Silver 3-Day Overlay

Note: Green is today (or last trading day)

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Monday, October 17, 2016

#Gold - The crowd still too bullish


Net commercial gold dealers

dropped further their positions,

which are now at the lowest level

since May 31st. However, the

positions are still sizeable. Large

speculators (hedge funds and

managed money) further took their

losses (attachment 1).

 

In the silver market large speculators

reduced their positions taking the losses.

Net commercial silver dealers also

reduced their short positions, which

historically are still large (attachment 2).

 

The KITCO Gold Survey indicates that

Wall Street and Retail investors are in the short

term still in the bullish camp. This is not a

good sign (attachment 3).

 

The Gold Barometers are neutral for

precious metal stocks and physical gold

and silver (attachment 4).

 

The Gold hourly chart (attachment 5)

shows that gold went nowhere last week.

As a matter of fact gold was unable to rally

after the sharp losses of the week prior.

Gold lost US$ 5.00 per ounce last week

(New York time 4:00 p.m.) to US$ 1,252

per ounce. It all looks that a test at the

US$ 1,200 per ounce will follow.

 

Gold stocks always outperform the physical

gold price in an environment of rising gold

prices. On the other side, falling gold prices mean

that gold stocks decline sharper than the gold

bullion. The attached chart 6 shows that the

ARCA Gold Bugs Index (HUI) climbed from a

low of around 100 in January 2016 to a high of

around 285 by August 2016. HUI lost about 30%

over the last two months, whereas the gold bullion

declined around 9%. The HUI Index has just

fallen a bit below the 200-day moving average

(attachment 6).

 

 

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