SWISS allow unrestricted selling of Gold (and what that means).

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The value of Gold dropped today slightly upon the news that the Swiss do not wish to restrict the outflow of Gold. The swiss hold 1041.1 tonnes of Gold, 7th the world after USA (8133 tonnes), Germany (3401 tonnes), IMF (2814 tonnes), Italy (2451.8 tonnes), France (2435.4 tonnes) and China (1054 tonnes).

Derestricting the sale of Gold should actually not affect Gold itself, however when they start selling Gold off it will mean that the market flow for Gold will go up, reducing Gold vs Dollar value. However if they had restricted the gold flow, then we could have seen Gold rally (reduce the amount of something and it goes up in value if there are buyers).

Gold is heading off to the east, China and India are keen to get more gold, India for jewellery and China because they are thinking of making it the new Reserve Currency. India said that if they had to pay off their debts the would use Gold to do it.

The FED think Gold is not money. But if you can pay for something with Gold, guess what, it is money.

For me, this move is just a small dent in a Gold rally that should slowly move upwards as I have said in previous posts.

HSBC said that the Feds tapering will have a negative effect on Gold, but they think it will be limited.

If I was a country I would bring Gold in at these prices and hold it. Exactly what the emerging markets are doing. If the dollar does eventually crash because of the continuing Debt Ceiling raises not being reconciled (you can’t go on increasing your debt forever). Then investors will move away to safe haven currencies like sterling (which has been doing very well recently) and metals such as silver and Gold.

Practically Gold is a long term buy for me. You need big stops to trade gold as it can move very fast either way. I reckon around 3k  pips. At these lower areas we are in a good place for a buy.

GBP is still making me nervous because it seems alone rallying hugely against the dollar, there is one word for this Bubble. I am concerned that it is rallying too fast and that it could have to correct even faster.

Happy Trading (remember sometimes the best trade is the wait trade).

Am I a rock star? Gold and a way of copying other traders with BelforFX.

I have been examining Gold and have noticed some very interesting patterns. We are nearing a very important level. Let me show you why.

Here is the monthly Gold chart.

 

As you can see it is in a massive hook on a monthly basis… at these levels we could be looking for another move up heading even higher over the long term. With China holding large amounts of Gold and India’s Gold shortage emerging markets are fuel to a fire that could go on for a while. But we just need that bullish break. Otherwise we could be headed lower, I would like to see the break pushed bullish by fundamental news on Gold NOT negative USD news.

Why expect a rally here? Because at this time the market can’t really decide what to do. But we need to wait this trade out. When it goes, it could go big, either way.

Belfor FX

On another topic, I was contacted by a broker yesterday “Belfor FX” you can see their banners on the site, now I’m not the sort of chap who changes broker easily, it’s a bit of a pain, all that paperwork. But for beginners (not that 6 years trading makes me a beginner!). There are some real advantages to their platform including the copy trader facility which allows beginners to copy other traders trades. Ideal if you are a new trader and want to watch what other traders are doing, social trading is in fact, in my view the future.

In the future we could see moves in the market kicked by social trading rather than by the market makers. Mind you I think we are a long way off.

They run the usual MT4 platform and web based trading and they give very good service.

So I would encourage everyone to try out an account. Incidentally it is not a good idea to hold your forex holdings in one trading account. Different brokers have different features and it takes some time to find one you really like.

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Gold…EUR.. is it recovery day.

Well thanks to the FEDS we had that massive drop in GOLD/EUR etc last week. I’m seeing signs on both charts that this could be recovery day and we could get back on track with a bullish rally.

Positive EUR data already this morning and virtually NO USD data mean this is a good day for buying EUR/GBP/GOLD against USD. But will we be able to rally enough to recapture last weeks bearish move and to turn things again.

Time will tell, I still feel the FEDS have simply kicked the problems down the road a bit, until February next year when the whole uncertainty of the USD debt ceiling yet again kicks in.

Eventually, USD will not be worth the paper it’s printed on, simply because they are in so much debt.

It’s Taper day, so what is priced in.

Yesterday the dollar rallied against GOLD/EUR/ETC. (However I am still well in profit on my lots Gold Greenback buy).

I did watch a lot of traders saying it was  a trend change, however my opinion is that the market has priced in a hold back of the FED taper to December next year, even though the chances of that are only 10%. This means that if they hold the taper back till, say, March, the dollar will drop, and fast.

We have a LOT of US news today as well, so it’s not a day of trading for the faint hearted. I am planning to evaluate my GOLD vs Dollar buys today and be possibly completely flat before 18:00 GMT (this means out of any trades), At 18:00 when the news comes out the dollar may whipsaw very very fast. Plus the fed tapering news, if you have a heart condition today may be a bad day to trade!

Happy trading everyone.

Gold still going up. In since 1270 with 4 lots.

The Average True Range of gold moment has significantly dropped,  like it’s waiting for something. But that is Monday’s for you.

We have consumer confidence from the US at 14:00GMT today, which may provide some momentum for a move, meanwhile I am still looking for targets of 1410 and perhaps all the way up to as high as 1800! As all my trades are on moving stops they are in profit so if it goes against me I will only lose a fraction of the profit from these trades.

My feelings…. Gold and Balloons have a lot in common at the moment. Up, Up and away.

There is still a gold shortage in India and since China is hoarding Gold and the US debacle over the debt ceiling (which will rear its ugly head again early next year), we should see further Gold advances as the world becomes less and less enamoured with the green back.

Incidentally I have been mildly amused by the chat going on on trading view with regards to Gold. Comments like “Well I’m short Gold now”, like watching one of those TV shows where you know the answer to the question but the person competing doesn’t, “NOOO don’t short Gold”.

(Well some people only want to make 5 to 8 pips, I’m in 82 pips profit on just one of the 4 trades. Today, well they are pushing up against 1361/1360 area, bottoms in at 1349, 1350 of a trend line so if I may add another lot here… we shall see, put it like this, I can’t make a loss now, it’s impossible even if the trade goes against me.

Anyone fancy shorting Gold? Well.. . you won’t believe it but there are people out there doing it!

 

 

Gold – the Indian Shortage.

I have been talking a lot over the past weeks about Gold rallies, I’ve been buying since 12750 and am now around 1341. I will continue to hold longs for the following reasons.

1. There is an increasing shortage of Gold in India.
2. China is hoarding Gold.
3. You cannot print Gold, it has to be mined.
4. The dollar has suffered a huge knock back from the government shutdown/near default.
5. Because of 4, there is a move afoot to develop a new reserve currency, and guess what, Gold is the current favourite, in fact India is already buying oil with Gold.
6. It’s shiney.

Just to chart my trades a bit for you I rode two lots up to a top then let it retrace then bought again,  I was looking for a break of 1345 which we got yesterday so I’m now back with two lots on looking for another days upward movement.

How high will it go?, well I’m not too bothered as I have a 3000 pip trailing stop, this protects my risk/investment but means I don’t have to spend all day staring at charts.

We have UK GDP out today so this should be interesting.

Non Farm Payrolls day…watch out!

Today is an historic day for Non Farm Payrolls, normally the madness happens on a Friday, so the effects are short term, today we get NFP on a Tuesday, this means the effects could last all week. Also, the fact that the dollar has been weaker against other currencies. BAD NFP figures could further fuel the fire of the USA not tapering its bond buying plan that would cause a drop in the dollar. It could further fuel the buying of Gold/Silver and other non-fiat currencies.

Of course yesterday’s trading was incredibly slow and tedious due to the waiting for these results.

So here is the key data for today

TIME (GMT) Description Strength   Est. Prev.    
13:30 US USD Nonfarm Payrolls (Sep) 3   180K 169K    
13:30 US USD Average Hourly Earnings (MoM) (Sep) 2 0.2% 0.2%
13:30 US USD Average Hourly Earnings (YoY) (Sep) 2 2.1% 2.2%
13:30 US USD Average Weekly Hours (Sep) 1 34.5 34.5
13:30 US USD Unemployment Rate (Sep) 3   7.3% 7.3%

My guess 171000.

I can’t find the normal thing Bloomberg do with the experts predictions. But let’s just say it could either go mad or do virtually nothing. Just depends on the results.

Have a great day everyone.

China, the hoarder next door and the new reserve currency, Gold.

Well after Gold’s rally against the dollar yesterday I thought I might explain why I’m buying gold.

After the USA’s embarrassing fiasco with the debt ceiling, I started looking into other currencies to trade, and found out some very interesting information about emerging nations such as China and India, Ben Bernanke said that Gold was not money. The Indians and Chinese think differently, the Chinese at the moment are wisely (in my opinion) looking to back their currency with Gold. The Indians are buying oil with Gold. The move for a new world reserve currency not particular to any country is in play.

The result.

Gold hoarding.

The result.

A shortage of Gold

The result. (stop me if you’re bored)

Gold rockets in value against every other currency particularly the USD which will, as it is no longer the reserve currency find itself floored.

Gold sits at 1320, I entered at 1250. I am holding for another rally or two and moving my stop up to follow it 3000 pips behind.

Gold continues bearish based on USD news.

Ok here’s the thing, the USD agreed last night a temporary increased debt ceiling. Why does this sound like a problem? Because I think they are just sticky plastering a festering wound and not dealing with it properly. (how CAN they deal with it properly?)

Gold broke down below 1290 yesterday as a result but bounced back up to 1295 off the bottom of the head and shoulders on the daily chart I posted yesterday. I think if we are going up today is a good day to do it as we have completed the head and shoulders and the increased debt ceiling news is already built into the market’s price, also it’s square up day.

So it’s hold back and wait till we get clear direction but the 17th October is no longer a problem and the USD is now built into the market price.

Is Gold now turning?

Well the debt ceiling discussions are coming and that means GOLD could rally bullish, there are already signs that the head and shoulders that we went through has now been invalidated, we have 7 days to go (only 5 days working!) and still no solution on the government shut down or the debt ceiling, the last time this happened, it pushed to new highs, at the moment. XAGUSD has been bouncing off of 12950. This is the daily chart. Imagine what would happen if we got back up to those highs and you had a buy in!.

 

Here’s the 10 minute chart.