Libertys :High low prediction

Trading Discussion
173

Hold On, I’m Coming

Gold fell down and broke its crown today, but oil is plummeting toward a rendezvous with destiny. The equities markets can’t decide what to do, having been up in the morning but now definitively down in mid-afternoon.

The ambiguities that stock traders are puzzling over have also affected the dollar, pushing it a bit lower. The greenback move, however, hasn’t been enough to really force gold down very much. Regular trading did that trick very handily.

It’s all well and good to say that gold is being pulled along by oil in its descent, but that’s not quite enough. Gold is reacting to economic news that the stock market, because of the sinking price of oil, can’t interpolate.

The seemingly unstoppable expansion of U.S. manufacturing burst forth even stronger in numbers released today for November’s activity. It seems like a second wave of automation investment is beginning to pay off with everything from the manufacturing of string to toys, vinyl records to aluminum fabrication sheets improving – everything is picking up. There were some soft spots around the country in manufacturing, and of course, deeper automation does not produce many jobs. But, it brings the U.S. manufacturing economy front and center on the world stage. (It is already the biggest manufacturing power.)

Manufacturing grew at 1.1% in November after a rise of 0.5% in October. That is significant.

There was a blemish on the U.S. economic news report today, though. Housing starts were down, although when adjusted for seasonal factors it was not terribly meaningful.

So, gold reacts to those inputs, but, again, because of tumbling, tumbling, tumbling oil prices, the stock markets can’t. After all, energy represents 12 to 15% of the Dow and the S&P 500. Some analysts are calling the bottom in oil. We think that bottom is in the $50 (+/- 5%) range. But, a likely scenario is that we may see a long period where prices do not go up, but rather stagnate.

Finally, starting tomorrow, the Fed meets. The question as always is, “What tune will they call?” Rest assured that it will be playing, “Hold On, I’m Coming.” Although they won’t actually be “coming” in the sense they will not be “raising rates” for some time yet.

Europe stagnates; China scrambles; Japan backslides. Someone’s got to keep the finger in the dike.

Wishing you as always, good trading,

174

decided to stay long @1220

175

Losing Their Cool

Like so many of the markets, gold seemed befuddled today. Lowering volume, choppy trading that surged then receded, and indecision based on flying rumors about what the Fed might or might not do, hampered gold.

In late afternoon trading, it is up about $1.50, although it is well off its overnight highs, currently trading at 1196-97.

Part of the confusion in markets is being caused by the continuing economic deterioration in Russia. After two smaller, “warning-shot” rate hikes, Vladimir Putin raised interest rates to 17%. Any takers out there ready to buy a piece of Russian debt?

Oil steadied a bit today, most likely because of the psychological support level of $55 in WTI crude. The usual pattern has been recently for WTI to slowdown its descent and then for Brent, the benchmark in the commodity, to tighten the price gap between the two.

Very quietly, not exactly under radar but stealthily nonetheless, interest rates on the three major bonds – U.S. Japanese and German – have been sliding toward shocking lows. The American 10-year is right above 2%. Japan’s is at 0.365% and Germany’s below 0.60%. Breathtaking, indeed.

We don’t believe that the Fed is going to actually lower rates tomorrow. That would be foolhardy, given the rest of the world’s situation. There is a strong likelihood, however, that the U.S. central bank will eliminate or start to eliminate certain phrases in its guidance as it prepares the financial community for the effects of higher rates later in 2015.

That has not prevented everyone today from running around like peasants in a village in the Middle Ages who have seen a meteor flash across the night sky. Everyone on the street – whether in New York, London, Tokyo or Hong Kong – is scurrying about like frightened maniacs, not sure of what to do. Only Shanghai held cool, driven higher by good news in its phone-manufacturing sub sector.

Let’s see how sober the Fed is tomorrow. Meanwhile, fundamentals remain too cloudy for playing in precious metals.

Wishing you as always, good trading,

176

Predicted Daily price Range for Gold :
high:1216.59
Low :1180.93

177

tp for long is 1240 im still holding my long @ 1220

Predicted Daily price Range for Gold :
high:1199,68
Low :1180.36

178

Last night before FOMC decided to hedge my long I closed my hedge as soon as gold cooled down abit

179

Mixed Messages

While the Fed left in place its notation that interest rates would remain stable for a “considerable time,” they also boldly underscored progress that was being made. Inflation is nearing the initial target of 2 to 2-1/2% (although plunging oil prices won’t assist in that), and the labor force’s long-standing underutilization is diminishing.

The statement released today went on to say, speaking from both sides of the Fed’s collective mouth:

“However, if incoming information indicates faster progress toward the Committee’s employment and inflation objectives than the Committee now expects, then increases in the target range for the federal funds rate are likely to occur sooner than currently anticipated. Conversely, if progress proves slower than expected, then increases in the target range are likely to occur later than currently anticipated.

The Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction. This policy, by keeping the Committee’s holdings of longer-term securities at sizable levels, should help maintain accommodative financial conditions.”

At first, gold investors and traders bid up the metal. Then, as other minds took heed, it was pushed down. Equities are the biggest gainers on the day, the Dow, S&P and NASDAQ up 1.70%, 2% and 2%, respectively. So, money clearly began moving into that class of investment.

The troublemaker, crude oil, was up about 35 cents, a meaningless number given its previous plummeting. Bond yields rose modestly.

Incongruously, the dollar strengthened, which lent the meaty part of the weakness to gold. Through whichever means blowing the hardest, it seems as if gold is on its way to testing if not its previous 2014 bottom, at least on its way to probing for a meaningful current bottom. (See Market Forecast.)

The word “patient” in the Fed statement was also tied into Chairwoman Janet Yellen’s allusion to the idea that the Fed would not even be considering rate hikes for the next couple of meetings. There are meetings in late January, mid-March and late April. If conditions warrant, April could be the beginning of such deliberations. However, the two hawkish dissenters will no longer be on board; but neither will the committee’s most dovish member serve. In general, the FOMC will be more centrist except for the leadership, which tilts dovish.

Like the Fed on larger issues, we counsel patience in gold trading right now.

Wishing you as always, good trading,

180

Gold Outlook 2015 | The Gold Forecast

181

Step Into The Magic Oscillator

The Markets must have four stomachs. They chew, re-chew, re-digest and finally – well, maybe finally – settle on a group-think opinion.

Today that opinion says that the FOMC statement is good for stocks, good for America (cue the “Star Spangled Banner”), good for the world, for everything right and just in the universe. But just wait till tomorrow.

Again, just to confound us, gold is up along with the equities markets. Oil, however, continues falling into the deepest well known to mankind. The markets seem out of synch with the traditional way they usually operate. As we know, usually gold and oil move together.

But, there is some news in the physical markets that is buoying the yellow precious metal.

India is going to further raise import quotas on gold. Production levels of gold are lowering. And, some, but not all, ETF’s are stocking up again. Some analysts are saying there is increasing haven demand for gold. But by whom?

All three stock markets in the U.S. are up by over 2% today. The Dow is up 377 points to frame the movement of money in that format. The U.S. 10-year bond’s yield is up slightly. And the dollar is up against the euro and yen, although down against the GB pound. (The pound benefited as the Swiss took interest rates to zero. Either the pound or the Swiss franc serve as a European hedge against the euro.)

So, there is a missing piece of the puzzle.

That puzzle piece will partially be made up of a reinterpretation of the Fed statement made yesterday. Another part of the puzzle piece is the movement of money from oil to gold in countries where it is difficult to hide assets an investor might have in equities. Gold is, above all, portable and untouchable, almost invisible in many cases.

Regardless, there is a huge problem for gold on the fundamentals horizon. If, as more reports are asserting, Russia’s currency reserves are about half of what previous reports had stated, Russia will look to sell off big chunks of its gold holdings. Russia holds about 1,100 tons of gold. It used to be said that it represented 10% of its foreign exchange reserves. Now it means that gold accounts for at least 20%.

If Russia begins selling gold, we will have to take heed. Wishing you as always, good trading,

182

Predicted Daily price Range for Gold :
high:1211.44
Low :1186.13

183

hedged my long

184

Muscles On Its Muscles

The dollar is driving the world – and possibly driving a few countries like Russia and Venezuela crazy. The dollar is now at its highest since 2009, up almost half of a percentage point on the euro today. Is this a bet by some investors that the Fed is about to raise rates? We think rather it is an indication of just how powerful the U.S. economy has become relative to the rest of the world.

This is yet another, if usually unspoken, factor the Fed must take into account when it thinks about raising rates. With many countries or regions near or at zero percent, because of export cost considerations, the U.S. central bank has to think three times before raising rates.

In regular trading, gold would have been up today. Because of continued dollar strength it is down, though not by much – off $2.40 at 4PM in New York. Oil did not join its sister commodity in declining today, which is not so much an indication of general conditions in supply and demand but a sign that traders are nervous under the $55 per barrel (for WTI crude) mark. Keeping a continued hawk-eye on crude is imperative.

The equities markets slowed on their way up today; but given this is the last Friday before the holiday whirlwind begins in the western world, even a small rise has to be considered important.

New unemployment data said yesterday that claims dropped yet again. This is seasonally adjusted and takes into account holiday hiring. As a footnote to hiring, the San Francisco Bay area saw a jump of 23,000 new hires last month and Pennsylvania’s statewide rate placed it on the verge of going below 5%. Both areas have mixed sector economies, an indication that the future belongs to the diversified. The unemployment rate for white adults over age 30 in the New York City metro area hovers just above 1%. That tells us the future belongs to the highly educated. Black teenage unemployment is at 22%.

These indicators demonstrate that for the well educated or deeply trained, jobs are no longer a problem. Indeed, the Labor Department is reporting that job openings are at an all-time high in the United States but that the world’s largest economy lacks properly honed workers to fill them.

One of the reasons unemployment will not go under, say, 4%, anytime soon is that the under educated are going to be less in demand and the jobs they are qualified for will remain scarce. We can also surmise that because all those openings for advanced workers are going unfilled there will be wage inflation among the already employed. However, regular inflation will be muffled because new workers who would be well paid are not entering the stream.

All this fundamental news adds up to trouble for gold. A growing, nearly booming economy does not demand safe-haven assets. And, with wage stagnation – or rather lack of new high-wage earners – inflation will remain subdued.

The Fed has some fancy footwork ahead of itself. Wishing you as always, good trading,

185

Predicted Daily price Range for Gold :
high:1199.86
Low :1192.22

186

Cheap Oil Is Dragging Down the Price of Gold - Bloomberg

Predicted Daily price Range for Gold :
high:1196.17
Low :1163.56

187

my long is hedged and added a short in tp @ 1168

188

1163******

189

Merry Christmas to everyone

190

happy nnew years

191

Every Other Day

Today, oil took another licking and gold came along for the ride. The dollar was up strongly once more, except against the British pound. Contradicting the usual expectations, U.S. equities were down, although that might be expected as those who are ready to book their losses do so before the bell tolls on 2014.

The pattern for gold in the last dozen trading sessions is well established now. Up toward resistance one day, then down to support the next. Oh yes, the cycle may take an extra day once in a while, but, the pattern is unmistakable.

As we said, oil is still taking a beating, down more than 2% today. It’s a bloodbath. We’re now approaching a shakeout price level, which is between $45 and $50 a barrel. Right around that level, high-cost producers bail on keeping their supplies flowing. Naturally, that will drive the price back up unless the Saudis or Venezuelans step in and produce more. That, however, is unlikely to happen because their refining capacity has been reached already.

Peeking over the horizon for 2015, what are the major fundamental issues to keep an eye one? Here are a few bullets:

– We will discover just how dovish the new FOMC is. One man’s meat is another man’s poison. We are sure to hear increased chatter from the sidelines as more hawks are bumped off voting status in the new session and will undoubtedly give public vent to their fear and loathing of low interest rates.

– We will discover just how strong the U.S. recovery is and how the single biggest unified economic force on the planet can help other regions grow or sustain current growth. A man’s got to know his limits.

– We will find out if plummeting oil prices are actually good for the world economy. Seems so, but the road to hell is paved with good intentions.

– Finally, we will find out whether the era of thinking of gold as “money” – stable money – has actually ended. As fear of the future declines, so does the price of gold. Or, will the yellow precious metal be like the attendees of Woodstock and be able to sing, “We are stardust, we are golden”?

Wishing you as always, good trading and here’s to a happy and prosperous 2015!

192

Predicted Daily price Range for Gold :
high:1199.68
Low :1178.69