Your Next Gold Opportunity In Three Charts

Gold, Ingots, Treasure, Bullion, Gold Bars, Wealth

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Your next gold opportunity has been around for about two years now.

Incrementum released their monthly Gold Compass Report this month. You can download it here.

There are a few good insights and one major opportunity.

Three charts show us where…

As you may know, the price of gold has come down from its (unadjusted for CPI) all-time high of $2146 back to down to hit resistance just above $2000 at $2030. This looks due to declining US Treasury yield curves, buyers simply didn’t hold, while short-term gold traders sold off too.

As the dollar continues to hold its strength on hopes the Fed will lower interest rates, we can assume a sideways and slow upwards motion for gold at least until mid-January. I’m going on annual cycles to assume that…

Meanwhile, a few days ago Alasdair Macleod released a chart showing that volume in gold and silver futures is declining. He said, “…this shows a decline in selling pressure.” And what that means is that traders are looking at gold futures volumes to see if there is interest in moving the spot gold price. If there’s high volume and open interest, you can generally see the price of gold also move. So gold prices are leveling out for a while.

While the price of gold remains above $2000, we’re also seeing new declines in another chart. Incrementum’s latest report shows monthly Gold ETF flows. While we saw a small rise in the Gold ETF inflows in late spring, we are now consistently seeing a pattern of outflows since late 2021. The chart below compares the price of gold to Gold ETF outflows.

Here’s what the difference between gold and ETFs actually looks like. The chart below shows the price of gold compared to the price of the Van Eck Gold Miners ETF (GDX). Since early 2021, you can see a departure in direction. Gold is going up. GDX is going down.

If you don’t want to dig into specific gold miners in the ETF, or exploration companies, then tracking this departure would be a good option to catch the GDX at a bottom. Just watch those volumes as they pitter out like the 2016 lows when the GDX more than doubled.

When the Fed decides to start lowering interest rates and then increasing the M2 Supply that’s when we’re most likely to see some changes and more inflows to Gold ETFs. For now, trading gold seems to be leveling out and we could even see some declines below $2000 with gold futures falling below October levels.

It’s true. You’ll make the most money in a bear market.

And the big money is in the waiting…


More By This Author:

Gold: $2000 Might Still Be Resistance
Is This Gold Breakout For Real? De-Dollarization May Be The Key Factor.
Someday This Will Happen To Silver

Disclaimer: This is not financial advice. Before making any investment decisions, you should talk to a registered advisor in your area.

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