Turd is back on the throne and ready for another crazy week. Let's get started!
A rash of gold-positive headlines this morning has caused a $25 spike in price over the past few hours. From ZeroHedge, here are the main excitement generators:
ECB Intervenes: Briefly Brings Italian Yields Under 7%... And Sends French Yields To Fresh Record Highs
If anyone would like to take a stab at explaining where any of those seven headlines is not precious metal bullish, go right ahead. <crickets> So, with the fundamentals being soundly reinforced this morning, we turn to the charts for some insight as to where we might be headed this week.
First up, let's look at gold. The only thing disturbing the bullish picture this week is CoT report from Friday. Lots of spec longs were added along with an almost equal number of new Cartel shorts. This is, most certainly, not a bullish development. Always remember, though, that the CoT survey was taken after the close last Tuesday...a week ago today. With the beating that gold took on Wednesday and Thursday of last week, a lot of the spec longs were likely flushed. Then, the rally on Friday definitely contained a lot of Cartel short-covering as price jumped $30 yet the total open interest only grew by 70 contracts. The point is...the CoT situation is probably not as scary as the report made it look back on Friday.
For our first two gold charts, let's look at a daily and a 4-hour. It's very important to note the trend channel from the late September lows and that gold is comfortably rising within the channel.
For a short-term perspective, check out this 2-hour chart. This wedge needs to be watched for the next few days. For today, at least, resistance should come in between 1790 and 1795. IF we can get through there, 1800 will be equally challenging. However, once that level falls, $1850 or so will be our next target.
The situation in silver is a little more dicey. The CoT report wasn't quite as unnerving but the charts need to be watched. Fortunately, silver has now bounced off of its primary trendline twice in the last three days. This is a very helpful development. However, we must watch that line very closely. You can see it on all three of these charts. For today, that support is near $33.80. It is critical that silver stay above that level. Conversely, IF silver can break out through 35 and 35.60, our next target is 37 and then the area between 39 and 41.
OK, that's all for now. I'll have more for you later today. TF