Quite a few of the companies reporting earnings this week will keep the retail investor focused on equities. So far this quarter, 73 percent of companies that have reported earnings have beat the street estimates, giving investors the confidence that the equity market rally has more room to the upside even if Washington is not capable of getting anything done.
Since July 12th, the Gold ETFs have seen a steady decline in holdings as over 1.8 million ounces have been redeemed by investors. I, for one, would expect to see this in a declining market not one trading higher. So even with all these redemptions the price of the yellow metal has been absorbing the selling quite well.
At the time of this report, we see the Dollar Index trading just below the 93.50 level that everyone continues to watch. Predicting the direction of the price of Gold every day is as easy as watching the action in the dollar index. On Thursday last week, the Dollar index set a new low for 2017, reaching a low of 93.15.
For the Gold rally to continue, we must stay below the 93.50 level in the dollar index. Otherwise, I expect to see some profit taking by those who I call “nervous longs” exiting the market, creating an offer bias on the price for the short term.
It is no surprise we have seen buying interest of late in the gold market with the news out of North Korea and the newly imposed sanctions put on Russia.
Levels of resistance are now at $1,279 in the December Gold Futures contract and $17.02 in the September Silver Future’s contract.
Believe It Or Not
The Sun reports a box possibly carrying 4 tons of a “valuable metal” has been found by UK based Advanced Marine Services aboard a Nazi ship that sank off the coast of Iceland in 1939. The metal could be gold stolen from South American banks that may be worth 130 million dollars.
Or it could be a pile of rocks.
Still, many believe the S.S. Minden was in route to Germany when Hitler ordered the ship to be sunk on purpose. According to The Daily Mail, Advanced Marine Services has asked the Icelandic government for permission to cut a hole in the ship to remove the box. Ergo, finders keepers. However, Iceland is reportedly going to be making a statement on who owns the metal. This isn’t the first time Brits have made their way into Icelandic seas hoping to discover gold rumored to be stolen by Hitler. Rumors of Nazi gold have swirled for decades with some theories saying Hitler was stealing gold and art for the pensions of his top officials.
Have a wonderful Monday.
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