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This gold chart is ugly: expert
Gold prices tank Friday after a massive sell-off. With a US budget deal expected soon, is this a sign of things to come for gold?
Gold prices tank Friday after a massive sell-off. With a US budget deal expected soon, is this a sign of things to come for gold?
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The yellow metal plunged from $1,285 per ounce to $1267 at the New York market opened when an order for 5,000 futures contracts (500,000 ounces, nearly $640 million worth) placed at New York Mercantile Exchange. According to market data company Nanex, a portion of that order – 2,700 contracts – triggered stops, forcing a 10-second halt in trading. After the halt was lifted, the remaining 2,300 contracts were traded.
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This also traded through the key technical support level of $1,300, breaking the neckline of a head and shoulders pattern which began in July. [[You must be registered and logged in to see this link.].]
This comes as optimism spread that a compromise may be reached allowing the US government to pay its debt on time. Gold is now down 4% for the week.
Gold is also down 7% from its September 19 highs. That's when the Federal Reserve Bank told the markets it would continue its $85 billion per month bond-buying policy which has been adding dollars into the financial system and lowering interest rates. Even before Friday's fall, gold was trending downward despite the traditional use of gold as an inflation hedge.
Gold investors are not having a good 2013. Since January, the metal is down over 24%. Meanwhile, the S&P 500 index is up 19%.
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So, is this recent sell a harbinger of things to come in gold?
In the video above, two analysts take on gold's next move. Looking at gold's fundamentals is Zachary Karabell, president of River Twice Research. Charting the gold ETF (the GLD) is Andrew Busch, author and publisher of [You must be registered and logged in to see this link.].
What can we expect from gold? Watch the Talking Numbers video above to see what fundamentals' and technicals' take on the metal.
The yellow metal plunged from $1,285 per ounce to $1267 at the New York market opened when an order for 5,000 futures contracts (500,000 ounces, nearly $640 million worth) placed at New York Mercantile Exchange. According to market data company Nanex, a portion of that order – 2,700 contracts – triggered stops, forcing a 10-second halt in trading. After the halt was lifted, the remaining 2,300 contracts were traded.
(Watch: [You must be registered and logged in to see this link.])
This also traded through the key technical support level of $1,300, breaking the neckline of a head and shoulders pattern which began in July. [[You must be registered and logged in to see this link.].]
This comes as optimism spread that a compromise may be reached allowing the US government to pay its debt on time. Gold is now down 4% for the week.
Gold is also down 7% from its September 19 highs. That's when the Federal Reserve Bank told the markets it would continue its $85 billion per month bond-buying policy which has been adding dollars into the financial system and lowering interest rates. Even before Friday's fall, gold was trending downward despite the traditional use of gold as an inflation hedge.
Gold investors are not having a good 2013. Since January, the metal is down over 24%. Meanwhile, the S&P 500 index is up 19%.
(Read: [You must be registered and logged in to see this link.])
So, is this recent sell a harbinger of things to come in gold?
In the video above, two analysts take on gold's next move. Looking at gold's fundamentals is Zachary Karabell, president of River Twice Research. Charting the gold ETF (the GLD) is Andrew Busch, author and publisher of [You must be registered and logged in to see this link.].
What can we expect from gold? Watch the Talking Numbers video above to see what fundamentals' and technicals' take on the metal.
