News, analysis and commentary for gold traders and investors

"Be Right - Sit Tight"

Jesse Livermore
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Gold Market Wire

News, analysis and commentary for gold traders and investors

Gold Market Update

Gold Market Stalls out - Awaits US Election

October 28, 2020 - (Gold Market Wire) - The Gold market continues to move in a tight range as the wait for the outcome of the US Presidential election, in a week's time, keeps the price of Gold in a tight range.

trend line has fallen

Our main trend line has been broken to the downside, but interestingly, there has been no follow through action. We are, essentially, out of the channel, but truthfully, its of little meaning when the market has essentially stalled out due to the forthcoming Presidential election, and is likely to be a hotly contested outcome. The real story is one of sagging volatility and declining volume.

volume continues to fall

Those who had the foresight to short the $1900 strike two weeks ago, and held on, have done themselves proud. Since the outcome of the election is unlikely to be decisive, nay, contested, it was the trade to put on...and may still be the one to keep. Premium erosion from time (theta) and the drop in vol. (vega) have been rewarding the premium short sellers, at the money.

note: our big position in Corn, established several weeks ago, has finally come under pressure, as it needed to. Like all markets in a new bull phase, things got a little ahead of themselves. Some profit can be taken, but we remain confident that the rally in Corn is merely beginning, and will go on for several years. More length on pullbacks is the name of the trading game for Corn, with a solid core held. A real sell-off may even encourage a leveraged core position, which is always most rewarding at the start of bull markets.

quite a run

...but merely a necessay pullback.

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