Gold Market Wire
News, analysis and commentary for gold traders and investors
Gold Market Update
Friday Gold Closing Goes Right to the Line.
December 6, 2021 - (Gold Market Wire) - Sometimes in this game of Gold, you just have to laugh. Friday's close was one of those times. As we wrote on Friday, hours before the close: "Short of a significant change of fortune at the close, the weekly formation for Gold looks poor. Weak closes on Friday's have a tendency to lead to Asian sell-offs on Monday, so if you are trapped long, and we don't close COMEX over $1780, you better get out of the market." So what did we get?
...or more accurately...the Long Island RR shuffle, as we like to call it.
Yes, right when the locals (and pros) decide to square out the book for the weekend, we take off.... right to the line. The market wakes up, gets pushed lower for everyone to chase and then its bought back right before going to lunch on Friday and heading home. What a show! Then, right after the square out - the public chases strength in a thin market. Pure comedy Gold.
So we close right on the trend line, but what do we learn, besides the tempo of the Friday shuffle, which we have been warning about for weeks now? Well, the trading community is actually short, because it is covering into Friday noon-time. That tells you quite a lot. Those who chased into the end of the day had better be careful, because, for our money, it really looks like the tape was painted, and painted obviously, on Friday.
We're going nowhere near this market. If anything, we could spec short here at 2:40 a.m. New York Time. Painting the tape is the favoured move that pros do to catch suckers, and we have our hackles up.
The US Dollar still isn't quitting and has opened in Europe with further strength. That puts Gold under pressure. Right now, the safe haven play is favoring the US Dollar. ...and most likely Crude Oil. Eventually Gold will be added - but it doesn't look like it in the short term. A big week is beginning, and it it initially looks like US Dollar strength, especially as Europe, politically, economically and socially looks like it is heading into the abyss. If you think America looks bad - try the EU!
In the short term we stand aside any serious position-taking... while we spec short Gold. Our first such spec short in years. But that looks like the trade right now. US Dollar length, added last week vs GBP and EUR is maintained. We remain bullish the Dollar - despite what the Goldbugs insist. Money is flying out of the Eurozone into America, and that is going to do nothing but push the US Dollar higher.