Investors Eyeing Gold Fork in the Road

Topic: We have reached a fork in the road.

The Gold market for the last couple of days has been trading in a tight range on both sides of the 200-day moving average.
These prices are getting old and we look for some news or event that with give us some direction. The fork in the road is the
200-day moving average and to quote the late , great Hall of Famer, Yogi Berra, “When you get to the fork in the road take it!” I’m sure you can’t argue, but I’m tired of looking at that fork in the road.

I guess one reason we might be stuck here temporarily is, a lot of folks are attending the LBMA conference and are away from the office.

Chatter out of the conference expressing the mood of the attendees is bearish. Going forward, most are looking for Gold to eventually trade between 800 and 1000 dollars. Reasons are a combination of things. First, the FED is not sure what to do about raising rates any time in the future. Second slowing Chinese growth is putting pressure on the metal.

I’m not joining the bear settlement. My take is this market will continue to trade in a tight range. I expect Gold traders
to sit on the sidelines waiting for some news that they can trade off of. I was hoping for a Gold rally to the $1,200 level to see if this market can get some traction to the upside and attract new buyers, but as the days pass with no movement my hope is just fading away.

Retail Gold investors are still out to lunch enjoying their stock purchases of late. Most financial advisors reporting some activity in the Gold ETFs, but very little interest from the individual investor for physical Gold.

Have a wonderful Wednesday

Walter Pehowich is the executive vice president of precious metals investment services for Dillon Gage with over 38 years of experience in precious metals investment services. His career began in 1977 at Bache (which evolved to Prudential-Bache Securities and then Jefferies Investment Bank). While at Jefferies, he served as senior vice president with oversight of investment grade precious metal products. Pehowich holds a National Futures Association (NFA) Series 3 license, authorizing him to advise and sell alternative investments in commodities and futures markets.