1. U.S. Futures


Gold - Futures and ETFs

Discussion in 'NYSE, NASDAQ, AMEX' started by bigbear0083, Jul 24, 2017.

  1. bigbear0083

    bigbear0083 Administrator
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  2. bigbear0083

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    Here is just a copy paste from my post over on r/StockMarket today-

    This is just a quick follow up post on the /GC (Gold Futures) here.

    If you all recall I had created a thread here a few weeks back posing the question to the community if the yellow metal was ready for a meaningful move higher soon.

    Here was that thread - Click here to view!

    While a couple of people who had replied in that thread disagreed with my synopsis of the idea of seeing Gold moving higher, whelp that seems to have played out to tee at least for now as we're seeing day #1 of the breakout for Gold futures over $1300.

    I really like the fact this wasn't just a rip up on the first test of 1300 back in the beginning of this month. That was IMO more likely to fail than not. But the fact that this spent some good amount of time around that 1300ish resistance area really was the fuel for this break higher. Very meaningful and constructive IMO.

    I'm still bullish on the yellow metal here even despite today's big break through. Ultimately I think next target could be around $1350ish (not all in one or two days! but over a period of weeks perhaps) on the /GC. Whatever the catalyst might be, weaker dollar, saber rattling from NK, global turmoil, etc.

    Speaking of the weak dollar, it's just been a steady stair case lower for the greenback all year long. - CHART I can't see how that is anything but bullish for the yellow metal. Unless we see the dollar begin to turn back up in a meaningful way I feel Gold will continue to its recent trend north.

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  3. bigbear0083

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    Precious Metals Finding Support and Eyeing Breakouts
    Tue, Apr 6, 2021

    After a strong run in the first months of the pandemic, gold (GLD) has been in a downtrend since the summer erasing most of the past year's move higher. While GLD is far from breaking its longer-term downtrend, the past few weeks have at least seen a bit more constructive price action with a potential double bottom forming. After trading deep into oversold territory in early March, GLD found at least a temporary bottom right around the lows of last sping's range. Last Tuesday, there was another successful retest of those same support levels. Since then, GLD has pressed higher and is getting close to breaking out of the past few weeks' consolidation range.

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    Elsewhere in the precious metals space, silver (SLV) has generally fared better over the past several months. While it hasn't been pressing higher either, SLV has more or less been trending sideways since last summer's high. Since late February, SLV had been heading back to the bottom end of its range, but like GLD, it recently found some support. SLV took a brief dip below its 200-DMA one week ago which snapped a streak of 217 consecutive closes above its long-term moving average; the third-longest on record since SLV began trading in 2006 as shown in the second chart below. That drop below did not last long though as SLV has since moved back above its 200-day. Now, it is sandwiched between its 200-DMA and 50-DMA; which it had previously failed to move above last month. Additionally, the move higher today is breaking the short-term downtrend that has been in place for most of 2021. Like gold, the overall longer-term picture for silver has a lot of room for improvement, but at least in the near term, there are some positives developing in the past week.

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  4. bigbear0083

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    Gold (GLD) Extending Winning Streak to 10
    Wed, May 26, 2021

    Just over a week ago, gold, the SPDR Gold Trust ETF (GLD) closed above its 200-DMA for the first time since February 1st. The rally that took GLD above its 200-DMA has also broken the downtrend that had been approaching a year in age. Today, GLD is up another 0.22% to the highest level since January 7th.

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    Given another move higher today, GLD is also on pace to close in the green for the tenth day in a row. That is not necessarily the case for other measures of the yellow metal like front-month futures which experienced a 2 bps decline on Monday, but with regards to GLD that is tied for the second-longest winning streak on record. At ten days long, the current streak of consecutive gains is the longest run since the 11-day streak ending 1/2/18. Prior to that, July 2011 was the only other double-digit streak with a few other nine-day-long steaks; the most recent of which ended in July of last year.

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    The recent rally in GLD continues to set up the over-decade-long cup and handle pattern that we have made note of in the past, though, GLD still needs to rally another 8.15% to take out last summer's highs to complete the pattern. Given the nearly 8% rally over the course of the current winning streak, GLD has reached extremely overbought levels at more than 2 standard deviations above its 50-DMA and begs the question of how much steam is left.

    While it is certainly too small of a sample size to put too much weight on, looking at the streaks in 2011 and 2018 that also went on for 10 or more days there has been somewhat mixed performance. The instance in 2011 saw further gains one week later and particularly strong performance over the next month with an 11.4% move higher. Granted, those gains were erased over the course of the rest of the year after the streak came to a close. One year out, GLD was lower than where it stood at the end of the streak. The more recent streak on the other hand was lower one week after coming to an end. While there was a bit more upside in the next quarter, six and twelve months later it was again lower. In order for GLD to take out last year's high, it's going to have to buck its recent trend that followed prior extended streaks.

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  5. bigbear0083

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    Gold "G-loiters"
    Mon, Feb 7, 2022

    Everyone knows that gold 'glitters,' but for the last year, it's more like 'gloiters' as the commodity has been loitering around the $1,800 per ounce level. This morning, gold is trading modestly above $1,800, which is a level it has crossed above and below multiple times in the last 12 months. In fact, the average price of gold over the last 12 months has been $1,795 per ounce, so there hasn't been a lot of movement.

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    Taking a longer-term look at gold shows some interesting trends. On a five year basis, the last 12 months of sideways trading looks like part of a consolidation phase for the commodity as it digests its big move higher from mid 2018 through early 2020 when prices surged from under $1,300 per ounce to more than $2,000.

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    While gold's move over the last year looks like a consolidation of a strong rally on a five year chart, a ten year look at gold shows another trading range where prices today are right around the same level they were in 2012. As long as gold can hang around in the $1,700 to $1,800 range, the longer-term technical picture looks positive.

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    Just as the last year's sideways pattern for gold looks like a consolidation of a strong rally on the five year chart, the sideways pattern of the last ten years looks like a very long-term consolidation following the rally in the early 2000s where prices rose more than six-fold from under $300 per ounce in early 2002 to nearly $1,900 in August 2011.

    With a one-year trading range of less than 15%, gold is trading in its narrowest one-year range since July 2018, and before that, 2005. Eventually this range is going to break, and based on prior experience, once the range breaks, it usually expands pretty rapidly, so one direction or another, gold looks poised for a significant move going forward.

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  6. bigbear0083

    bigbear0083 Administrator
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    Gold Breaks Out!
    Friday, February 18, 2022

    Both stocks and bonds have faltered to start the year, with the S&P 500 down approximately 8% year to date and the Bloomberg Aggregate Bond Index down about 4%. However, this tough environment for traditional asset classes has given gold, an asset many investors have forgotten about over the past decade, some time to shine.

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    As shown in the LPL Chart of the Day, the price of gold is not only up 3.8% since the start of the year, but just broke out to its highest level since June 2021 on Thursday. So is this move for real, and will gold continue to benefit investors’ portfolios?

    “Gold has been a frustrating trade over the past year or so,” said LPL Financial Technical Market Strategist Scott Brown. “But we think the most recent breakout has a strong chance of turning into a more durable rally because of the steady base that has been built over the past six months.”

    Going forward, we see the November highs near $1,875/oz. as important support to hold following the breakout, but believe it isn’t unreasonable to expect the yellow metal to test its all-time highs near $2,000/oz. at some point in 2022. Certainly gold has benefited not just from the poor returns in equities and fixed income, but also headlines about a possible Russian invasion of Ukraine. However, it has also powered through a dramatic rise in real (inflation adjusted) interest rates since the start of the year, something many investors expected to be a headwind as the market looks ahead to the Federal Reserve raising interest rates. While trading off headlines is never recommended, we believe the trend in gold and commodities more broadly suggests it may deserve a position in suitable investors’ tactical portfolios.
     
  7. bigbear0083

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    Precious Metals Harden Up
    Wed, May 11, 2022

    Little has been safe from heavy selling pressures recently including assets normally considered "safe havens" like precious metals. Gold is currently down over 9% from its March high while silver is down roughly 20% since its spring high. Today, both metals are bouncing from notable levels. For gold, it is finding support at its 200-DMA which also coincides with the rough uptrend line of higher lows of the past year. In addition to dramatic underperformance versus gold, silver's test of support is perhaps a bit shakier. It is well below its moving averages, but today's rebound is happening right around the lows from September and December. Granted, on an intraday basis, both yesterday and today's lows breached those levels.

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    Given silver's much larger decline, the ratio of gold to silver has ripped higher in the past month. In fact, the ratio has risen over 10% in the past month. The most recent 10% or larger surges were as recent as this past December with two even larger ones in the spring and fall of 2020. Prior to the pandemic, though, these sorts of rapid increases in the gold to silver ratio have been rarer. Before 2020, the only other instances of the past decade were in the springs of 2013 and 2017.

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  8. bigbear0083

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    Gold Performance During QT
    Wed, Jun 15, 2022

    Quantitative tightening (QT) has wide-spanning effects on the economy, as it puts upward pressure on risk-free interest rates due to increased supply in debt markets (assuming all else equal). The Fed announced its QT strategy just one meeting (5/3/22) after hiking its target rates for the first time since 2018 back in March. The previous QT cycle in 2017 did not begin until about two years after the Fed first started hiking rates. The reason for the quick turnaround this time around, though, stems from the fact that inflation has been running rampant, and the balance sheets of consumers and corporates are in relatively strong positions.

    In terms of how various asset classes may perform in the current period of QT, some investors have looked back to the prior period of QT for insight. As mentioned above, there are some important distinctions between the current period and the last period of QT, so it may not be an apples-to-apples comparison, but there are certainly some similarities that can make knowing what happened back then helpful. Using the price of gold over the last 15 years as a backdrop, the chart below shows key events related to periods of quantitative easing (QE) and QT. The event surrounding each dot is summarized in the table below.

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    Between October 2017 and July 2019 (the last QT cycle), the price of gold rose by 12.6%, which works out to an annualized return of 6.5%. Over the last 15 years, the price of gold has held an annualized return rate of 6.8%, so there was no clear differentiation in the performance of gold during that period of QT and the last 15 years as a whole. Looking at the chart, though, much of the gains from the last cycle of QT came late in that cycle as the Fed had already announced its intent to end the running off of assets from its balance sheet. In fact, the S&P 500 outperformed gold by more than six percentage points during the last QT cycle. In fact, before the March 2019 announcement that the Fed would wind down its balance sheet, gold was practically unchanged relative to the start of the QT cycle.

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  9. bigbear0083

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    Gold Weakness
    Wed, Jul 6, 2022

    Investors often turn to Gold as a safe asset in tumultuous times, as the asset tends to hold its value during market downturns. For example, when the S&P 500 sold off by 34.1% during the COVID Crash, the SPDR Gold Trust (GLD) declined just 3.6%. In 2022, GLD initially acted as a strong hedge to the equity market, gaining 1.0% on a YTD basis on June 16th as SPY entered bear market territory. However, GLD topped out in early March and is now trading 14.0% off of its closing 2022 high. GLD has even underperformed SPY since March 8th, declining 14.0% versus SPY's drop of 8.2%.

    Over the last four months, GLD has declined by 10.3%, which is elevated for a relatively stable asset during a bear market. Since its inception in 2004, GLD has declined 10% or more over a four-month period (with no occurrences in the prior three months) twelve times with each occurrence shown in the chart below.

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    The forward performance following four-month declines of 10%+ has been mixed depending on the time frame. The next day (which would be today), GLD has booked a median loss of 10 basis points, gaining just 45.5% of the time. However, the median return and positivity rate in the next week is inline with historical averages. Over the one and three months, performance tends to pick back up, registering gains 63.6% and 72.7% of the time, respectively. Over the next three months, GLD has had a median gain of 5.0%, which is more than two and a half times the median of all periods.

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  10. bigbear0083

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    Speculators Short Precious Metals As Miners Surge
    Mon, Sep 12, 2022

    The latest CFTC's Commitments of Traders report with data as of last Tuesday was released on Friday. This report tracks how speculators are positioned among various futures which we show as a net reading in the charts below. Positive readings indicate a net percentage of open interest is long whereas a negative reading indicates a larger share of speculators are positioned short in a given future. Below, we take a look at those readings for a handful of precious metal futures.

    As shown, gold has rarely seen more shorts than longs over the past decade and is the only precious metal currently positioned net long (+22.29%). However, that is not to say this reading has not been weakening lately. This past spring, the reading fell outside of the past few years' range, reaching a low of 18% back in mid-July. While the second half of July and some of August saw it rebound, last week marked three straight weeks of declines. Meanwhile, silver futures have seen positioning turn outright short recently. With a net 9.24% of open interest positioned short, that is the most pessimistic positioning reading since May 2019. Likewise, it has been almost four years since platinum has been as heavily bet against as now. Finally, palladium has also seen speculators turn against it in the past year to a degree not seen at any point of the past decade.

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    As speculators turn increasingly bearish, we are actually coming off of a very strong week for metal adjacent ETFs. As shown in the screenshot of our Trend Analyzer below, the best performing ETFs last week in our US Groups screen were gold miners (GDXJ and GDX) as well as the Steel ETF (SLX) that tracks steel producers and suppliers. The Junior Gold miners (GDXJ) rallied double digits over the prior five days, which was a move that lifted it out of extreme oversold territory and almost back up to its 50-DMA.The Gold Miners ETF (GDX) was not far behind with an 8.85% rally. SLX was only a percentage point behind that as it presses into overbought territory for the first time since August 29th.

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  11. bigbear0083

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    Gold to Silver Ratio Plummeting
    Thu, Sep 22, 2022

    In spite of it being considered a safe haven asset and inflation hedge, gold has had a rough year with a nearly 10% decline year to date. The yellow metal has consistently traded below its 50-DMA over the past few months while the 200-DMA is fairly flat. Over the past several days, gold has been trending sideways right near 52-week lows.

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    Silver has not avoided declines and like gold has largely remained below its moving averages. However, its sideways action in recent days has proven a bit more constructive. Unlike gold, silver rallied in the first half of September moving back above its 50-DMA in the process. Since then, there has not been a massive degree of follow-through, but it has managed to hold above that moving average.

    [​IMG]

    For the past year and a half, gold has generally outperformed silver as shown in the uptrend of the ratio of the two metals since early 2021. However, the underperformance of gold in recent weeks has led the ratio to pivot sharply lower. Over the past 15 days, the ratio has fallen 11%; the first double-digit decline since February 2021. Looking back through the early 1990s, there have only been a handful of other periods in which the gold-to-silver ratio has fallen by a similar degree or more in the same span of time. Outside of last year, the only other occurrences in the past decade were 2013, 2016, and 2020.

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  12. bigbear0083

    bigbear0083 Administrator
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    Gold Tarnished
    Mon, Oct 31, 2022

    The end of October is now here and barring a massive turnaround by the close, gold is on pace to once again end the month lower. Gold peaked back in August of 2020, but since the spring it has taken a more dramatic leg lower. In spite of a high inflationary environment, the often-considered to be go-to inflation hedge has been on a relentless streak of declines. With October's lower close month to date, gold has now dropped for a record seven months in a row. Going back to 1975, there have been a handful of other streaks lasting for five or six months, but none until now extended out to seven.

    [​IMG]

    Although the current decline has been a record in length, the degree to which gold has fallen during it has not been as severe as some of the prior streaks of 5 months or more. For example, in 1976, 1981, and 1982 gold fell well over 20% compared to the current 16.1% decline. While we do not have a crystal ball to see if gold will end this streak in November, we would note that during the month that snaps these streaks, gold's performance tends to be particularly strong with an average gain of 5.5% compared to the norm of only a 0.5% rally for all months since 1975. Similarly, gold tends to find itself higher three, six, and twelve months later with stronger than normal performance.

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  13. bigbear0083

    bigbear0083 Administrator
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    Gold Breaks Out Ahead of Election and CPI
    Wed, Nov 9, 2022

    High inflation and the aggressively hawkish monetary policy that has come in response, an election, and battered risk assets lend plenty of reason for investors to have sought out safe havens for their money this year. However one such asset, gold, has gotten crushed all the same. The yellow metal is down 18.5% from its 52-week high set in the early spring but on the bright side, it has begun to break out of its downtrend. As shown below, gold has tested support at roughly around $1,620 at multiple points this fall. After the last successful test only about a week ago, front-month futures have surged over 5%. The result has been an upside break of the longer-term downtrend as well as the 50-DMA. This is the first time since the spring gold has traded considerably above that moving average.

    While that positive technical development is in the books, it is not necessarily out of the woods yet. There has not been a higher high yet meaning a move above last month's unsuccessful test of its 50-DMA (around $1,730) would be the next hopeful sign for gold bugs.

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    Additionally, the current run has occurred at an interesting point in time. Historically considered a prime safe haven asset, gold's run over the past few days has coincided with a couple of catalysts for uncertainty in the headlines: the midterm election and tomorrow's CPI print. Based on where gold is trading as of this writing, the metal is up nearly 5.5% over the past four days. As shown below, in the four days leading up to every other CPI release since at least June 1998, that ranks as the fourth-best pre-CPI rally and only the fifth time it has rallied more than 5%.

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  14. bigbear0083

    bigbear0083 Administrator
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    Gold: The Shiny Rock is Shining
    Posted on March 29, 2023

    Most risky assets have had a volatile stretch since the Silicon Valley Bank crisis began. The S&P 500 Index has recovered but is still down about 0.5% between March 8th (the day prior to the crisis unfolding) and March 28th. In a welcome change from last year, bonds have zigged while stocks zagged, with the Bloomberg Aggregate Bond index rising about 1.4%.

    But one asset has outperformed during this period: Gold, which rose 8.1% over the same period.

    Gold as a crisis hedge
    The last 20 days were a period when fears of an economic crisis rose. Economic growth expectations fell, and as we wrote last week, even the Federal Reserve (Fed) acknowledged that they may not have to do as much as they originally expected to slow inflation. Instead, a potential credit crunch is expected to substitute for rate hikes.

    As a result, interest rates fell (which is why bond prices rose), and importantly for gold, “real” interest rates fell.

    Real interest rates = Nominal interest rates – Expected Inflation
    Typically, real interest rates fall when economic growth falters, and investors expect the Fed to cut rates. And over the past 20 days, the 10-year real interest rate, i.e., the yield from 10-year treasury-inflation-protected securities, fell from 1.66% to 1.24%.

    That is a significant drop, and historically such declines in real interest rates have been accompanied by rising gold prices.

    Conversely, gold prices have historically fallen when real interest rates rose. Which usually occurs when economic growth picks up and/or the Fed raises rates in a bid to prevent overheating and higher inflation.

    The idea is that if real interest rates are high, there is an opportunity cost to holding (and storing) gold. Whereas if real rates are low or negative, the opportunity cost for holding gold falls.

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    Last year was a strange year for Gold
    Gold is typically thought of as an inflation hedge. So, on the face of it, you would think gold would shine during a year that saw a 40-year high in inflation, with headline CPI hitting 8.9%. Yet gold prices were flat across the year.

    In fact, between March 8th and September 30th, 2022, gold prices fell a whopping 18%, even as inflation surged. The problem was that the Fed got really aggressive with rate hikes after March 2022 as they looked to tame inflation. As a result, the 10-year real interest rate rose by 2.72%-points during this same period, from a low of -1.04% to +1.68%.

    Talk about a brutal and abrupt end to the negative interest rate regime that we had experienced for several years.

    Interestingly, real yields stabilized from October onwards, thanks to inflation data pulling back and investors expecting the Fed to ease up on the pace of rate hikes. Consequently, gold rallied, rising 15% between October and January.

    Prices fell again as real interest rates resumed their uptrend – which followed a series of hot economic data releases in February that sent Fed rate hike expectations higher. This lasted until the SVB crisis hit on March 9th.

    [​IMG]

    Where could Gold go next?
    A lot of this obviously depends on what happens with real interest rates. Real rates are certainly lower than they were before the SVB crisis. However, with the Fed backing off the aggressive rate hike path they expected a few weeks ago, we believe real rates may not go much higher than they are now.

    This means gold’s downside is potentially limited. Plus, as we saw, gold works quite well in the event of an economic downturn (in which case real yields are likely to fall), which makes the shiny rock attractive as a portfolio hedge at this time.

    My colleague, Ryan Detrick, pulled the lens further back with a long-term chart of gold. You can see that gold prices were more or less flat over the last decade after stellar returns in the preceding 12 years.

    Gold prices surged 508% between 2001 and 2012. Whereas it rose just 9% between 2013 and 2022.

    [​IMG]

    So, gold could be on the verge of a multi-year breakout here, especially if real interest rates don’t rise much further.
     
  15. bigbear0083

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    Gold Back at 52-Week Highs
    Tue, Apr 4, 2023

    Gold has been trending higher since the fall, and after a retracement earlier this year, the past month has seen the yellow metal surge by over 12% to reach new 52-week highs on an intraday and closing basis as it moves back above the March 20th intraday high.

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    Not only is gold at a 52-week high, but it is at the highest level since March 2022. That was when gold spiked higher to come up just short of the August 2020 high. In other words, the recent rally in gold has been significant, but leaves it short of a critical resistance level to watch.

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    While the post-pandemic highs have yet to be taken out, the fact that the commodity has reached a 52-week high is at least promising based on historical performance. In the charts below we show the average performance of front-month gold after the first 52-week highs (on an intraday basis) in at least two weeks. As shown, near-term performance is nothing to write home about with one-week returns that are basically right in line with the norm for performance since 1975. From there, returns tend to get much stronger with a higher consistency of gains to boot. Longer run returns like six months to one year out are particularly impressive with average gains that are more than double that of the average gain for all periods.

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  16. bigbear0083

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    Metal Trend Testing
    Mon, Aug 14, 2023

    Alongside other risk assets, metal commodities have likewise had a rough go of it in August. As we noted in Friday's Bespoke Report, the single worst performing asset month to date has been silver. As shown below, front month silver futures have quickly pulled back to the bottom of the uptrend channel that has been in place for the last year or so.

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    As for gold, this spring saw another unsuccessful retest of the 2020 highs, with a "triple top" now formed.

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    Turning to the industrial metal copper, once again, performance this month has been lackluster. This month's drop in copper is putting to the test the uptrend off of the COVID Crash lows.

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    With weakness in both copper and precious metals, the relative strength line of copper versus gold has been fairly stable. As indicated by a falling and negative line in the chart below, copper has underperformed gold over the past five years, albeit more recently the line has not made any major shifts in trend.

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  17. bigbear0083

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    GLD: Heavier Than It Has Ever Been
    Thu, Aug 17, 2023

    If it seems to you like most financial assets have done nothing but go down this month, you're right. A perfect example of this pattern is the price of Gold. The SPDR Gold Trust (GLD) has had an intraday high and low that was lower than the intraday high and low of the previous day on each of the last eight trading days (shaded area in chart), and there has only been one day this month (8/4) when GLD had a higher high and higher low relative to the previous day. August has been a one-way street, and the direction has been south.

    [​IMG]

    What makes the current streak notable is that in the trading history of GLD dating back to late 2004, there has never been a longer streak of daily lower highs and lower lows. There have been three prior periods where GLD had lower highs and lower lows for seven straight days, but with yesterday's decline, GLD's current streak is now in a league of its own.

    [​IMG]
     
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  18. bigbear0083

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    Gold Closes in on New Highs
    Tue, Nov 28, 2023

    In last night's Closer and today's Morning Lineup, we discussed areas in commodity markets that have been selling off. One that has avoided those declines has been gold. As shown below, gold's outperformance isn't exactly new. Gold relative to a broad basket of commodities massively outperformed early on in the pandemic, but that outperformance reversed up through the spring of 2022. The past year and a half has seen that outperformance generally return, especially over the past couple of months.

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    Amidst that outperformance, the yellow metal has been rallying since its early October low having gained 11.5% since then. That brings the commodity back within 0.65% of its 52-week set in May and 0.77% below the all-time high from August 2020 (what had been the first all-time high in nearly a decade). However, since the 2020 high those levels have repeatedly acted as tough resistance.

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  19. OldFart

    OldFart Well-Known Member

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    Oversold bounce on the dollar making gold pull back some
    15 min chart:

    upload_2023-11-29_5-31-24.png
     
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