Gold Bullish Sentiment

2020년 10월 12일

Personality, I feel that we have met the GOLD bottom for the year. Possibly forever.
Well, my $1830 target 🎯 missed by $12, but that's OK.
So, why do I think the bottom is in the past?

• Dollar Devaluation
  The US Fed has devalued the dollar through a number of tools. This has and will have an effect on the equity & commodity markets. See, when the dollar is weak, the equity markets will rally - this has an implication that there will be no stock market crash any time soon.
  How the FED actions affect the market - ->
  
  
  
  
  In addition to this, as long as the equity markets rally and DXY remains weak Gold, silver, lumber, and agricultural futures will rally.
  Dollar Devaluation impact - - >
  
  
• Gold & Silver as a store for value.
  It's no secret that the DXY currently isn't the best for storing value as a reserve currency. Near-term bonds & yields are also at record low levels hence making it unattractive for hedge funds to stick to the traditional 60:40 portfolio allocation models as central banks are already flirting with the possibility of negative interest rates. So, what can they use as a store for value?
  
  [*Mining
  If you follow gold mining, you already know that there has been no gold discovery recently. This translated to basic demand-supply economics means that the price might shoot up. See, gold demand is going to rise in 2021. Last month's delivery of gold from futures was high and this is going to rapidly rise as we approach the December deadline for the GC1! continuous futures. You could also trade the VANECK gold miners ETF for a nice highly correlated compounding trade.
  
  
• CFTC COT WEEKLY DATA
  Hedge funds remaining bullish with record high net positions seen from last week's report with 323k long positions open.
  
  On the other hand, we are in volatile times, therefore, be careful. We are not yet out of the woods. Price is currently testing a breakout from a descending wedge. If it successfully stays above the $1912 support level, it's safe to assume that $1960 and $2000 are the next targets.
  

If you agree with the idea, like or leave a comment below 👍🏿 👍🏿