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Gold Futures and ETFs - GLD, DGL, GDX, IAU

Discussion in 'Stock Message Boards NYSE, NASDAQ, AMEX' started by bigbear0083, Mar 31, 2016.

  1. AverageJoesTrades

    AverageJoesTrades Well-Known Member

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    My latest signals. I'm short (utilizing DGLD) through Robinhood @ 42.00
    Capture.PNG
     
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  2. AverageJoesTrades

    AverageJoesTrades Well-Known Member

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    FED in my favor:
    Capture.PNG
     
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  3. AverageJoesTrades

    AverageJoesTrades Well-Known Member

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    still short via DGLD up ~8.3%
     
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  4. AverageJoesTrades

    AverageJoesTrades Well-Known Member

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    continuing to hold... shoulda bought puts, smh!
     
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  5. AverageJoesTrades

    AverageJoesTrades Well-Known Member

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    closed short position and am now long gold with UGLD
     
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  6. LSS Trading

    LSS Trading Member

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  7. bigbear0083

    bigbear0083 Content Manager
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    A Thanksgiving Bounce for Gold?
    [​IMG]
    Gold prices tend to move up prior to the holidays, and the trend worked especially well from 2000 to 2011. Seasonally speaking, it is best for traders to go long on or about the thirteenth trading day of November and hold for about ten trading days. Over the last 17 years, this trade has worked 13 times for a success rate of 76.5%. The longer-term history of this trade is not as good, nonetheless profitable. Gold has had a respectable year, up 10.8% as of today’s close.
    [​IMG]
    After briefly breaking above $1350 in early September, gold quickly retreated back under $1300. It appears to have found support just above its 200-day moving average. But, it has also been struggling to reclaim $1300 and hold above. Stochastic, relative strength and MACD indicators are mixed. Stochastic indicator is negative, relative strength was trending higher until today while MACD is still holding onto a positive signal. Seasonal strength could give gold the boost it needs to break out above $1300.

    [​IMG]
     
  8. AverageJoesTrades

    AverageJoesTrades Well-Known Member

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    Was this the seasonal low - Are we long gold through January now?
     
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  9. Onepoint272

    Onepoint272 2019 Stockaholics Contest Winner

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    It appears from the price action that the miners think so.
     
  10. anotherdevilsadvocate

    anotherdevilsadvocate Well-Known Member

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    T0rm3nted and Onepoint272 like this.
  11. bigbear0083

    bigbear0083 Content Manager
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    A Golden Day for Gold
    Jan 25, 2019

    Gold had a rough first half of 2018, but the precious metal has been rallying nicely since equity market volatility picked up in Q4. After making a bottom in mid-August last year, gold has taken a number of bullish technical steps to put it in a new multi-month uptrend channel.

    As shown below, gold first made a series of higher lows and higher highs to end 2018, breaking two key resistance levels in the process. It has made another big leg higher over the last month or so, and after a slight dip over the last two weeks, today it has popped once again. As of early afternoon trading, gold was testing another resistance level and trying to make a new rally high. If this resistance can be taken out today or early next week, gold bulls will be looking for yet another leg higher.

    [​IMG]
     
  12. bigbear0083

    bigbear0083 Content Manager
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    Gold’s Seasonally Weak Period Begins in February
    [​IMG]
    Seasonally, there is a weak price period for gold from late-February until late June or early July. Entering a short position on or about February 20 and holding until March 15 has been a successful trade 27 times in the past 44 years for a success rate of 61.4% with a cumulative profit of $45,140 per futures contract. However, in recent years holding onto the short position established in February longer has been the more profitable trade.
    [​IMG]
    The chart above is a weekly chart of the price of gold. The line on the bottom section is the 44-year average seasonal tendency showing the market’s directional price trend with seasonal weakness highlighted in yellow. Gold has enjoyed a solid rally since mid-August of last year when it traded under $1200 per ounce up to early February and nearly $1325 per ounce. That rally is beginning to show signs of faltering.
     
  13. bigbear0083

    bigbear0083 Content Manager
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    Gold Breaks
    After a strong start to the year, gold has been having a tough time since mid-April, and after breaking support at around the $121 level today, the SPDR Gold Shares ETF (GLD) has done more than a roundtrip since the start of the year. With support at this year's lows now broken, the technical picture doesn't appear to be too positive for GLD.

    [​IMG]

    Zooming a bit further out than just the last year, the five year chart for GLD doesn't look much better. From this vantage point, the rally to kick off 2019 marked just one more in a series of lower highs.

    [​IMG]

    From a ten-year window, GLD is still down sharply from its peak above $180 back in 2011. The encouraging aspect of this chart, though, is that this year's rally does appear to have broken the downtrend that has been in place since that peak. With that in mind, bulls on GLD could look at this recent pullback as a test and kiss-back of the downtrend line at around the $118 level and therefore is not as big of a negative as the break of support in the first chart would suggest. With GLD trading just above $120 now, that will be a key level to watch going forward. Any break significantly below $118 would spell trouble.

    [​IMG]
     
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  14. bigbear0083

    bigbear0083 Content Manager
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    Gold Weakness to Persist as Seasonal Factors Weigh
    [​IMG]
    Gold tends to post seasonal bottoms in late June or early July (shaded in chart below), as demand increases when jewelers again stock up ahead of the seasonal wedding event in India. Gold prices are also subject to spikes in demand from the investment community, as a hedge or protection from concerns over inflation or during times of economic instability or uncertainty. It is valued in terms of the U.S. dollar, so periods of dollar weakness can support gold’s value. Uncertainty over trade and tariffs does exist and has existed for some time now. During this time inflation (official metrics) has remained subdued while gold has been trending lower. The trend of lower gold is likely to continue.
    [​IMG]
    Shorting an August gold futures contract before Memorial Day and holding until the end of June has been fruitful in 29 of the last 44 years for a success rate of 65.9%. This trade’s best year was 2013 when stocks put up their best yearly performance in more than a decade. This trade has worked in 10 of the last 13 years.
     
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  15. bigbear0083

    bigbear0083 Content Manager
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    Stocks Crush Rocks
    Tue, Jun 18, 2019

    The 2010s have been a rough decade for the yellow metal. As shown in the chart below, since 2009, gold is on pace to lose out to equity market total returns by almost 10%...per year. It's the sixth decade since the 1920s that the spot price of gold has lagged US equity market total return; over the course of the last 8 decades, the cumulative underperformance is more than 4%...and once again, that's per year! Given the costs of storing gold, which generally translate to an upward-sloping futures curve (contango), this analysis using spot prices is if anything favorable to gold! In other words, persistent and large asset allocation to gold leads to a substantial underperfomance versus stocks, even when putting your hands on the scale in favor of gold. That doesn't mean investors should never own gold, which can be a useful investment in terms of portfolio construction, but it does suggest that incremental units of gold exposure will reduce returns relative to equities over the long run.

    [​IMG]
     
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  16. Onepoint272

    Onepoint272 2019 Stockaholics Contest Winner

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    That concluding statement may be true if 10 years is the definition of the "long run" but over the last 20 years the conclusion is far from the truth.

    In the fall of 2012 the SPX could have been bought for 0.8 ounces of gold and now it would take 2.2 ounces, however....

    The SPX priced in troy ounces of gold:
    upload_2019-6-18_20-15-38.png

    ….in a longer run the SPX is lagging gold.

    upload_2019-6-18_20-24-38.png
     
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  17. bigbear0083

    bigbear0083 Content Manager
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    Gold Breaks Out to 5+ Year High
    Thu, Jun 20, 2019

    Earlier this week we published a Chart of the Day suggesting that gold (in the form of the GLD ETF) was looking strong but needed to get above the $130/share level to experience a breakout and potentially leg nicely higher. We're seeing that break above $130 today as the yellow metal makes a new 5+ year high. Below are updated charts showing the move. You can really see in the longer-term chart (second below) how $130 has acted as stiff resistance over the last few years. A solid clearing above this level in the coming days opens up a move towards $150 in our view.

    [​IMG]

    [​IMG]
     
  18. bigbear0083

    bigbear0083 Content Manager
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    Time For Gold To Shine?
    September 11, 2019

    On this 18th anniversary of 9/11, our thoughts go out to everyone impacted on that fateful day.

    “The higher the base, the higher in space,” is an old technical analysis saying.

    Gold is up 18% year-to-date (as of 9/10/2019), poised for its best year since 2010, when it gained 30%. We see many reasons why this rally may have legs.

    Last year’s action was rare: The S&P 500 Index, 10-year U.S. Treasuries, and gold were all lower. Going back to 1971, when gold was officially removed from the gold standard, last year was the first year that all three assets were lower in a calendar year. Now in 2019, all three assets are up significantly, quite a difference from last year!

    Gold and stocks have trended the same way: Since 1980, stocks and gold both have risen in 19 of those 39 years, and both have fallen in only four years. Somewhat surprisingly, both were up more than 10% in eight of those years. Gold might be viewed as “defensive,” but history shows there can be times when both gold and stocks have had nice gains together.

    “Gold is breaking out to new highs after doing nothing for years,” explained LPL Financial Senior Market Strategist Ryan Detrick. “Concerns over the global slowdown, $17 trillion in negative yielding debt, inverted yield curves, and central banks stepping up their gold purchases have all pushed the yellow metal out of a picture-perfect base.”

    Technicals support a rally: As shown in the LPL Chart of the Day, gold completed a nice-looking six-year saucer bottom and broke out above previous resistance. As the quote at the start of the blog noted, when things base for years, the potential move can be quite explosive.

    A well-deserved pullback may present an opportunity for suitable investors to add exposure in appropriate strategies.

    [​IMG]
     
  19. bigbear0083

    bigbear0083 Content Manager
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    Golden Year for Gold
    Tue, Dec 17, 2019

    Last week, we released the Commodities section of our 2020 Outlook report. We highlighted that 2019 has been a mixed year for commodities with plenty of losers and winners. While energy commodities have generally done the best—with the exception of natural gas which has been the biggest loser in the space—gold has been another notable winner having its best year since 2010 with the seventh-best return YTD of the commodities in the Bloomberg Commodity Index. The yellow metal is also just one of four commodities that have delivered a positive total return over the past five years while the broad index has fallen 4.64%.

    Similar to other commodities, gold prices are susceptible to long term trends in price movements. The 1970s inflationary episode saw massive increases in prices, before surging real interest rates in the late 1970s and early 1980s drove down gold prices dramatically. After doing almost nothing for the next decade and a half, prices rose almost ten-fold. The post-crisis precious metals collapse cut prices almost in half but have been rising more recently. 2019 saw price sharply increase, especially after taking out the critical multiyear resistance around $1350-$1400. This year, gold has been an almost perfect proxy for short term rates, rising as the Fed got more dovish in the middle of the year before reversing as the Fed 's tone also turned around in Q4.

    [​IMG]
     
  20. bigbear0083

    bigbear0083 Content Manager
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    Gold Breaks Out Again But Will It Hold?
    Wed, Jan 8, 2020

    At the end of December, we highlighted in a Chart of the Day that gold was entering 2020 with a bullish technical backdrop. After sitting in a downtrend since its peak set in early September, GLD had begun to break out on December 23rd. Since then it has rallied 5.7% fueled by a shift towards safe-haven assets as geopolitical tensions have built with the Middle East. In the past few days, GLD has experienced yet another breakout taking out the September 4th closing high of $146.66.

    [​IMG]

    Although it has held above these levels so far, the rapid rise of the yellow metal in the past few weeks has led it to be extremely overbought by multiple measures. This means there is likely to be some form of mean reversion in the near future testing the sustainability of the most recent breakout. As shown in the chart below, yesterday's close over a dollar above the September high has led GLD to now sit over 3 standard deviations above its 50-DMA. That is the first time it has done so since June, and before that, you would have to go all the way back to April 2016 to find a time GLD was as extended by that measure.

    Similarly, another overbought/oversold indicator, the 14-day RSI, is echoing the extreme readings. While readings above 70 typically indicate that an asset is running hot, the current reading is now over 85! While there have only been a handful of times since the ETF first began trading that the RSI has tipped above 80, readings above 85 are even rarer. Similar to the price in regards to the 50-DMA, the last time things got this extended were in June of 2019. Prior to that, there have only been two other times the RSI has been 85 or greater: once in 2010 and again in 2011.

    [​IMG]
     

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