Author Archive: Dan Norcini

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Gold Futures’ Spread Continue to Tighten

| August 12, 2013 | Category: Trading
Gold Futures’ Spread Continue to Tighten

I wanted to provide a quick update for those who are following the “backwardation” talk out there. The futures market has still not entered a backwardation state but it is just about there. Also, thus far I have not seen anything that would signal any problems with the delivery process for the August gold contract but one thing that does stand out is that J P Morgan continues to be the consistent, large stopper of gold for their “House” account. Morgan is acquiring a lot of gold.

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Watch Copper Prices For Silver’s Short Term Outlook

| August 4, 2013 | Category: Trading
Watch Copper Prices For Silver’s Short Term Outlook

The market is in a trendless phase – the downtrend has been interrupted but rather than an uptrend starting, the market is consolidating (moving sideways) with a negative or bearish bias. Without a rising copper, palladium, aluminum, tin, zinc, price it will be up to gold to bring buying into silver with those who do so focusing more on its role as a monetary metal. While talk that inflation pressures remains subdued dominates current thinking, the grey metal will underperform gold. I still like to watch copper prices to get a better sense of what silver might do.

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Late Session Surge in Gold Conquers 50 Day Moving Average

| July 23, 2013 | Category: Price
Late Session Surge in Gold Conquers 50 Day Moving Average

Throughout most of the session day, gold was consolidating its recent gains. There was some chatter that some physical market demand, notably out of China, had eased off and that had some short-term oriented longs booking profits after realizing some nice gains. That selling, combined with some fresh short selling was serving to hold the metal in check throughout most of the session. Late in the day however, as the mining stocks caught another gust of wind higher, the metal surged upward breaking the 50 day moving average.

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Gold Has Impressed – What’s Next?

| July 22, 2013 | Category: Price
Gold Has Impressed – What’s Next?

Gold is adding to its gains from the Asian session last evening in impressive fashion as the climb today has been steady and methodical. It has all the appearances of a strong short squeeze accompanied by an inflow of new long positions, which is exactly what this market has been needing to propel it higher. If the speculators start falling back in love with gold again, the rally will have further to run.

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$1,300 Rejects Gold

| July 18, 2013 | Category: Price
$1,300 Rejects Gold

Gold was stopped cold in its tracks at the psychological round number resistance level of $1300. It had initially reacted to Ben Bernanke’s comments, by moving smartly higher. During the Q&A session which followed, gold was slammed lower by a wave of very strong selling. Think about it this way – the QE will continue as long as the economy needs it. Okay – what is new about that? We have seen this QE going on for some time now and to the minds of most market participants, there is still no real inflation threat looming on the horizon. What is there to make them waver the least in their convictions that inflation is benign? Answer – there isn’t anything… YET.

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Gold – Some Chart Analysis

| July 14, 2013 | Category: Trading
Gold – Some Chart Analysis

In light of the recent apparent reversal by Fed Chairman Ben Bernanke when it comes to the timeline for any TAPERING of the Fed’s Bond Buying program, I felt it might be a good idea to take a look at where gold stands on the technical price charts. From a pure chart perspective, the current move higher in gold is nothing more than a rally in an ongoing bear market. Remember, a market can end a trend without necessarily beginning a new trend in the opposite direction right away.

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Gold Undercut by Jobs Number

| July 7, 2013 | Category: Price
Gold Undercut by Jobs Number

As I have stated many times recently, gold is in a intermediate term bear market and as such, rallies are going to be sold by speculative forces until such time as the technical chart pattern changes. I wish to remind readers of this site not to be sucked into taking aggressive long positions in anything gold right now unless you have deep pockets and can absorb further losses while you wait for the deflation/inflation psychology to shift. Trying to buy into a market like this right now is attempting to catch a falling knife.

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Why Commercials Are Long Gold – A Reasonable Explanation

| July 1, 2013 | Category: Investing
Why Commercials Are Long Gold – A Reasonable Explanation

Welcome back to the world of risk management and HEDGING for the mining industry. That is what I believe transpired this past week. Many mining companies began to re-examine their swearing off of hedging or forward selling and moved to take steps that would guarantee their survival even if it meant leaving some potential profits on the table.

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This Game Will Stop When The Public Loses Confidence In Their Currency

| April 15, 2013 | Articles: General
This Game Will Stop When The Public Loses Confidence In Their Currency

All we need to do is to use our common sense to consider that if manufacturing is robust, there is a real demand for the raw materials, commodities, natural resources, etc., used to create those goods or products. When I see Dr. COPPER going one way, DOWN, and I see the equity markets going the other, UP, I know something is terribly, terribly wrong.

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Gold Price Drops Below 1200 Euro

Gold Price Drops Below 1200 Euro

There is a spike low down near the 1150 level made in September of 2011, the last line of bullish defense for euro gold. In a sense, this corresponds closely to the $1550 – $1530 zone on the US Dollar priced gold chart. Bulls would not want to see this level give way without an intraweek recovery as it would portend even lower prices

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Dow Jones / UBS Commodities Index Change to Benefit the Precious Metals

Every year, the various commodity indices, that are used by hedge funds and index funds to benchmark against, have a reweighting of the various commodity inputs that are used to comprise each particular index. During this reweighting process, the percentage of some commodities are increased while the percentage of others are decreased. As a result, those funds benchmarking against the index, are forced to recalibrate their particular portfolios, selling some commodity positions while buying some new commodity positions in order to come into alignment with the new weightings. Dow Jones/UBS recently announced that the precious metal component of their index will be increased by 2% from this year’s levels for […]

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Silver Fails at 32.50 Support, Attempting to Hold at $32

Silver Fails at 32.50 Support, Attempting to Hold at $32

You can see on the weekly chart that silver failed (once again) to extend through stubbornly strong overhead resistance near $35. Having done so, it is now setting back as speculative longs are getting flushed out. Additionally, fresh shorting is occurring. The metal looks like it wants to drift lower yet unless it can pop back over $32.50 before the weekly trading ends. If it does not, odds favor a move down towards the 50 week moving average near the $31 level. That would put it back near the middle of the very broad trading range that it has been stuck in for more than  year now and effectively leave it […]

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Gold Holding near Secondary Support Level, but is struggling

Gold Holding near Secondary Support Level, but is struggling

As you can see on this shorter term chart, gold has broken the nice STAIR-STEPPING PATTERN that had been in plce since the middle of August. The overhead resistance at $1,800 has proven to be too formidable for the bulls to overcome and thus the market has set back due to a combination of both stale long liquidation and fresh shorting against this resistance line. The market is probing lower looking to see at what price level more demand, especially on the physical market, can be generated. It is important that the line marked, “SECONDARY SUPPORT” does not give way. If it does, gold will drop to $1700 – $1690 […]

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Same Play – Different Act

Nothing much has changed since my last post which is why I have refrained from posting any recent comments since this past weekend. Gold is stuck below $1785 – $1800 and Silver is stuck below $35. Until these respective resistance levels are convincingly cleared, the market is going to sit here with the risk of the shorter-term oriented speculative longs getting impatient and bailing out. Thus far bears cannot break down either market but neither can the bulls blow past the obvious overhead capping action. This week’s COT report will be informative in allowing us to see what kind of , if any, spec liquidation has been occuring. Some sort […]

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