I am currently bearish the US Dollar Index with a projected target of $86.75. The paper assets seem to be out of vogue to the investment world at this moment in time. I do have a theory on how large institutional investors are strategizing with the paper assets at this time, but there is a great deal to cover. The investment world has turned it's focus to the Stock Market. Slightly positive reports over the last week along with thoughts of banking stabilization have created a rally in the Stock Indices. Tuesday, we look forward to the FOMC. It is difficult to predict the tone of the report in advance, but any progress may be construed as supportive leading to continued short covering and technical buying. Some investors may be bottom picking or feel that the bottom may be in. This is not my contention. The firmer equities may sway investors seeking safe-haven investments. We typically look for the Gold Market and the Stock Market to have an inverse relationship. We may see some divergence in this trend with some of the factors possibly influencing each market quite independently. The SPDR Gold Trust (GLD) has hit record highs exceeding the holdings of Switzerland. The Gold Mints are reporting volume buying of gold coins. The demand is  running high and mines are not reported increased production. The cost of production may be $700 - $800 depending on the location and other factors.   

Gold 

 

The April Gold Contract has traded in a range Friday of $919.60 to $941.10. It is my opinion that the Gold Market may trade in a range next week of $891.00 to $950.50. While my indicators remain short-term bearish, I personally feel that this market may take off again.  Monday is a day that can be extremely volatile.  I would look at possible support at $891.00.

A short note on the Crude Oil: The Short-term trend is clearly up for the moment and may range trade between $39.88-$53.88 in the May Crude Oil. It is my opinion that technical buying may launch this market higher. 

Traders that wish to enter on the long side of the Gold Market may wish to enter on a pullback to  $891.00. I still remain the Long-term bull to $1030.00. While I am bullish, I am still watching that $874.00. 

Healthy re-tracements may often provide more support to the market while allowing new entries. Given the volatility of the Gold Market, stops placed too close to entry levels will be vulnerable to election. To manage the risk without a stop loss, a trader may use a Call Option/Bull Call Spreads to limit their exposure.  Due to the fluctuations in this market, please consult with your broker or call us to strategize a risk management plan in line with your personal risk tolerance. Traders that wish to participate in the Gold Futures Markets may look at the E-Mini Gold contracts which have a lower margin requirement than that of the larger Gold contract.  Please look for current margins before entering this market and be sure to allow cash cushion for any adverse conditions. Please consult with your broker to calculate the risk, stop loss orders or option strategies before entering such a volatile market. Investors that wish to take a position in the Gold Futures market should devise a plan according to their goals, risk tolerance and the amount of money they are willing to risk in this sector. Like many other investments, the success of the trading plan must take into consideration the timing of the entries and exits.

 

   Please call or email me for the complete recommendation to coincide with your risk tolerance, so that we may apply the correct Money Management.   The Weekly Gold Digger is a Free Weekly subscription to receive trading opportunities by email along with fundamental commentary and basic technical points of interest.   Take a close look and feel free to call in and talk to me in greater detail.  It would be my pleasure.  

 Take a close look and feel free to call in and talk to me in greater detail.  It would be my pleasure. 

Good trading!

Call me at (877) 224-1952 or email me at lburton@danielstrading.com

 

 Futures' trading involves the substantial risk of loss and may not be suitable for all investors.  Trading advice is based on information taken from trade and statistical services and other sources that New World Trading believes are reliable.  We do not guarantee that such information is accurate or complete and it should not be relied upon as such.  Trading advice reflects our good faith judgment at a specific time and is subject to change without notice.  There is no guarantee that the advice we give will result in profitable trades.  All trading decisions will be made by the account holder.  Past performance is not necessarily indicative of future results.  Any dollar amount quoted is exclusive of commissions and fees.