RJO FuturesCast

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Metals

December Gold: Where Do We Go From Here?

Posted 11/10/2017 8:50AM CT | Joshua Graves

Gold has seen very positive price action over the past few sessions, but does it continue from here? The fundamental reasons why gold should continue to move up are strong. Right now, it appears that the equity markets are a bit overheated. We have seen a bit of a pullback yesterday as the market reacted to news that the republican led tax reform bill has seen a setback on the corporate tax cut not seen until 2019. This is a much bigger deal that most make it out to be. Right now, the equity markets are pricing in a perfect tax bill that will be implemented over the next 6 months. Something such as this delay in a corporate tax bill have ramifications that could drive gold futures higher. We also have things starting to heat up over in North Korea once more. It seems a deal is less likely after a direct statement from President Trump. A military solution over the next year seems more likely than not.

If you look at the gold market from a technical perspective, it seems gold is going to continue to march higher, with confirmation of a change in trend with a close above 1300. We found much needed support at the 200 day moving average, and are currently trying to blow through the 50 and 100-day. We have seen the MACD cross indicating a buy, and are not in an overbought or oversold territory. 

 

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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