For weeks we have been long Gold, watching the precious metal make a run at new recent highs. About a week ago we warned about the forced liquidation we were seeing, although we stayed long through it all. The pattern has slowly turned to slightly negative. We remain long with our proprietary algorithm, but see a lot to be concerned about.
Gold has made lower highs and lower lows for the past two weeks, but continued to maintain major support around 1700 June Futures. Between Monday and the overnight trade, it is obvious that Gold is preparing a much bigger move. Gold can still go big either way, we remain uncomfortably long and believe the move could be lower. We trade mechanically based on our algorithm, but something does not look right.
Silver and Platinum look mediocre as well, both on major support levels with a lean lower. We warned a week ago that Platinum and Silver did not look great when they failed to breakout to the upside. We are still long but like Gold have a lot of concerns that the patterns are changing. Remember we only trade with our model but from a trader’s perspective something looks rotten.
Here are the levels to watch: June Gold Futures 1680-1700 support, July Silver Futures 14.70-14.50, July Platinum Futures 760 – 750.
If any of these markets close below those support levels, it will trigger a sell signal. We will stay long until those levels fail and our algorithm reverses which means we will be long until tomorrow no matter what.
Todd “Bubba” Horwitz
We are now offering a comprehensive commodity report that complements our other services. The Technomental Commodity Report comes out on Wednesday evenings and provides comprehensive fundamental and technical coverage of most commodities that trade on the futures markets in the US and UK, as well as stocks, bonds, and digital currencies. There is a summary report on Friday after the markets close, and robust quarterly reports on each of the six commodity sectors and a general overview that recaps the past three months and offers projections and suggestions for the next quarter. Andy Hecht, the author of the report, has been a commodity trader since the early 1980s and has vast experience in markets across all asset classes.