Before we go into the weekend, I wanted to point out two positive developments.
- Gold formed a bullish engulfing swing low
- The COT report improved markedly.
Gold - Prices formed an official swing low as well as a bullish engulfing candle. We could see a little more back and forth early next week, but I like our chances for a bottom here.
(Click on image to enlarge)
COT Report - The commercials added longs and reduced their short holdings. Combined they’re net short 73,635, a bullish number. In comparison, they were net short 119,463 at the December low and 73,635 last July. After bottoming last July at 73,635, prices rallied from $1,204 to $1,362.40 in just 8-weeks. Chart courtesy of www.barchart.com.
(Click on image to enlarge)
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