RJO FuturesCast

Daily Futures Market News, Commentary, & Insight

Metals

December Gold, Cracking $1,300 Soon?

Posted 07/28/2017 9:58AM CT | Joshua Graves

Gold futures will continue to keep a data driven mindset that will have a spillover effect on the probability of the speed of another rate hike. Anticipation remains high for 1 more rate hike this year but the possibility of the FED zeroing in on winding down its $4.5 trillion portfolio of mortgage and treasure securities may play more of a significant role in direction. This is in effect is reverse quantitative easing. We should get further insight over the next few weeks when more significant data comes out.   

Analysis and Outlook

The daily gold chart shows that we are clearly in a bullish trend. A $60 rally so far has been quite impressive, and until we get a close beneath the 200-day moving average at $1242 and the MACD crosses back over we should continue to see a rally. The ADX, which measures strength of the trend, has finally started to weaken indicating that the strength of the trend is starting to run out of steam which is something traders should consider before going long this market. Watch for a situation where gold consolidates at this level and becomes range bound until the next drop-off in the stock market or significantly weaker data out of this week’s economic reports. Pushes through the $1275 could indicate a move to $1300 which is the next level of psychological resistance. Caution should be taken if we see a close below 1250 where a washout could occur into uncharted territories.

Dec ’17 Gold Daily Chart

Dec '17 Gold Daily Chart

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Joshua Graves

Senior Market Strategist
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.
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