RJO FuturesCast

Daily Futures Market News, Commentary, & Insight

August gold futures have seen quite the selloff over the past few weeks. Much of the recent washout can be attributed to the FOMC meeting in which the Fed gave unexpected guidance that two additional rate hikes this year was on the table. They had also given guidance that they were going to wind down their balance sheet. Additional reasons for the selloff would be the end of the recent washout in equities more specifically the NASDAQ. The market also seemed to be discounting favorable economic data from India which happens to be the world’s largest gold buyer. There are still reasons to be bullish, but at this point a real driver for a rally in gold needs to be something the trade does not see. A selloff in equities, geopolitical uncertainty, and unfavorable economic data in the US that might justify the Fed reconsidering two rate hikes this year. There is always a reason to own gold, but at this point August Gold needs to be holding above the $1245-1250 area from a technical and fundamental perspective.

Technically, August gold is hovering right above the 100-day moving average. The MACD has recently crossed to the downside indicating a longer term sell on a daily chart. It’s not a chart that looks friendly if you are a Gold bull, however, consider that almost every session since the June 6th high of $1,298.80 has been a down session on the trade. August Gold is likely to find its footing soon and if nothing more than a short term rally, there is a possibility for one. 

Aug ’17 Gold Daily Chart

Aug '17 Gold Daily Chart

Joshua Graves

Josh began his career in May of 2013 after graduating from Purdue University, West Lafayette. He received a degree in Agricultural Economics, with a Certificate in Entrepreneurship. He started at Paragon Investments in Kansas, the heart of wheat country. While working there he developed long term relationships with corn, soybean, and wheat producers, speaking with them on a weekly basis. His goal was to market their physical production more effectively through tracking basis, as well as hedge their exposure in the grain and cattle markets through a variety of futures and option strategies. He then moved to Florida to work for PFL Petroleum, a physical biofuels brokerage, and gained significant exposure to OTC and physical energy markets. Trading has been a passion from day one of his career. In his free time he stays active in downtown Chicago, attends sporting events, and holds an FAA Private Pilot’s License and flies Cirrus and Cessna aircraft regularly.