#Gold - Looking ready for the next leg up

Attached is the gold futures contract chart(nearest month - December).

The MACD turned down in early September (blue line crossing red line) and signaled a consolidation. Now the blue line is setting up for a golden cross with  the red line on the upside.

The gold market has tested several times just under the US$1'500 level, but the selling was never able to depress the gold price under that level more than a few days.

Trading programs are showing gold has entered into a positive cycle till at least year-end.

No euphoria yet in #Gold #MiningStocks: Still underperforming vs. Gold Price $GLD, $GDX, $XGD, $HUI, $GOLD, $NEM, $EGO

#Gold #MiningStocks: YTD Performance & Premium/Discount to Gold Price

Attached is a Table showing the performance of golds indices and senior gold stocks year- to-date ( 1.1. to 30.9.2019) (attachment 1- Source Scotiabank, Bloomberg)

 

The battle between the two largest North American Gold companies, Barrick Gold $GOLD and Newmont Goldcorp $NEM, was won by Barrick, +28%, versus Newmont's +9.4%. 

 

Eldorado Gold,$EGO, which was one of the least liked gold stocks and a darling of the hedge funds' shorts, gained the most, +170%!

 

The ARCA Gold Bugs Index, HUI, gained 26.6%. The S&P/TSX Global Gold Index (XGD), the largest Canadian gold shares index, rose 30.9%.

 

Attachment 2 indicates the premium and discount senior gold shares are trading compared to the gold price. The senior, intermediates and international gold shares are all trading on average at a discount and close to the historical low point.

Attachment 3 shows GDX (gold stocks ETF) has underperformed GLD (physical gold) lately.

#Gold’s price, is a key “signal amid the increasing noise of macroeconomic data.”

"Gold prices have been given little airtime in discussions of "serious" investment strategy. But even if you have no intention of considering an allocation to gold, there is a value in keeping an eye on the price, as it can be an interesting signal amid the increasing noise of macroeconomic data."

…

"Even when it is strengthening, the gold price is surprising. To the extent gold is an alternative store of value to the US dollar, it would be expected to move in the opposite direction to the currency. But recently it has been making material gains despite a strengthening dollar. Signs that the gold price is defying conventional wisdom suggest we should dig a little deeper."

Read today's opinion piece in the FT:

Why Buffett is wrong to dismiss the benefits of gold

Yellow metal provides a useful indication of economic expectations

Warren Buffett's group reported a staggering cash balance of $122bn © AP

Legendary investor Warren Buffett's much-quoted dismissal of the investment merits of gold is simple: the metal is "neither of much use nor procreative." But the Oracle of Omaha has got this wrong. Gold is constantly offering useful insights, if you look closely enough...

https://www.ft.com/content/4204de76-e395-11e9-b112-9624ec9edc59

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