Gold may be on verge of ‘breakout’ higher as ETF holdings rise
This post brings up some interesting facts in the gold market. It is no secret that when the gold ETFs were a huge contributor to the run up to $1,900+ in gold. Since that time the funds have been shedding gold. If this finally turns again and begin to accumulate gold again that will be a huge driver of the price.
Click here to visit the MarketWatch original posting page.
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Gold prices may be ready to make a significant move higher as holdings of the precious metal in the SPDR Gold Trust exchange-traded fund climb to their highest level in more than two months.
Holdings in the SPDR Gold Trust GLD, -0.02% the world’s largest physically-backed ETF, stood at 629.2 metric tons, or about 22.16 million ounces on Monday, that is unchanged from the level on Oct. 1, but they’re up roughly 1% from the 682.59 metric tons seen a month ago and stand at the highest level since July 21.
Taki Tsaklanos/Secular Investor
“Short term, gold is trading in an increasingly narrowing symmetrical triangle, with support at $1,102 an ounce and resistance at $1,152 an ounce,” said Taki Tsaklanos, head of research at Secular Investor.
Gold for December delivery GCZ5, -0.12% settled at $1,137.60 an ounce on Comex Monday, up $1 or 0.1%. It rallied 2.1% on Friday as a disappointing U.S. jobs report hinted at the possibility of further delays of an interest-rate hike by the Federal Reserve.
“Gold is close to a major breakout [higher] or breakdown, and we favor a breakout,” Tsaklanos said.
One of the key reasons for his upbeat outlook on prices is that “gold holdings of GLD ETF are steadily rising, suggesting a trend change.
Short positions in the ETF are also near their lowest point of the past few years and the ratio of put versus call options is nearing its lowest level since 2012, he said.
Mark O’Byrne, research director at GoldCore in Dublin, was also bullish on the outlook for gold prices.
He believes that gold may have “bottomed in the summer,” and could climb to as high as $1,300 an ounce by the end of this year.
And longer term, O’Byrne expects gold to “double in price and surpass its inflation-adjusted high of $2,500 per ounce in the next 3 to 5 years.”
The metal “remains undervalued when compared to assets such as stocks, bonds and property—all of which have surged in recent years,” he said.
That chart probably looks better today (the 6th) than it did when you posted it, given yesterday’s close.
Here’s the Goldman Sachs Commodity Index:
http://schrts.co/Dbyd07
If a new low is coming it’s not coming soon!
These 2 numbers mentioned in the text in relation to a c. 1% move in holdings don’t make sense:
” Holdings in the SPDR Gold Trust GLD […] stood at 629.2 metric tons, or about 22.16 million ounces on Monday, […]. 1, but they’re up roughly 1% from the 682.59 metric ons seen a month ago […]”
Looking at the original MarketWatch article… it seems the correct text is the following, FWIW:
“Holdings in the SPDR Gold Trust GLD, -0.20% the world’s largest physically-backed ETF, stood at 689.2 metric tons, or about 22.16 million ounces on Monday, that is unchanged from the level on Oct. 1, but they’re up roughly 1% from the 682.59 metric tons seen a month ago and stand at the highest level since July 21. ”
Best to all,
LPG
Doesn’t amount to a hill o’ beans really, does it?
Jeff Christian is bullish on gold prices but not for now starting nearer to 2017/2018 when he says it will accelerate to the upside. He gave no target for the low though n the interim.
Be careful with Jeff. He is deeply connected with banking cartel. His estimate for gold is always muted when gold rose from 250 to 1900 from 2000 to 2011. He never got people interested in gold. Example was in 2008, when silver was $13, he predicted silver would rise to $15-18 after 2020. Considering the volatility of silver, who care about that small increase in such as long time. For short term, his prediction is always around the current price. He also defends the big banks for manipulation.
But the good thing is he knows a lot. Sometimes he would describe how big banks manipulate the price and how leveraged they are, right after he denies manipulation even exists.
LOL !
He cannot stop bragging he is well connected.
Here is my appropriated and modified version of the above chart. No change: it’s bear flag city.
http://1000gold.blogspot.co.uk/2015/10/modified-appropriated-chart-from-corys.html
no point in putting up a 2 year chart, its triangle is created in 2015…I made better looking charts in grade 2, lol
http://stockcharts.com/h-sc/ui?s=$GOLD&p=D&yr=0&mn=10&dy=0&id=p53498821268&a=426531209&listNum=1
What’s your opinion then? Up or down?
Good article, Cory – thanks for posting.
As all TA monkeys know, a triangle usually breaks in the direction of the trend. It is interesting the put/call ratio, and the shorts – add to that the stuff Gary said about sentiment and COT – … and it may break up. But TA 101 says odds are, we break down. And Doc has sniffed this out.
Just to add – monthly $USD is also in an uptrend, and in a triangle pattern. $GOLD’s triangle is on a daily chart, so it’s not the same I know, but it makes sense to me that TA-wise, $USD has one final push up here, and $GOLD goes down. Maybe to Gary’s original $1030 mark?
Commodities are a buy and that’s good news for gold in dollar terms:
http://schrts.co/ioMNqr