Since our last report, gold rebounded and has stayed above the $1202 level. It was trading above $1210 at the time of writing this report, this is after the news that CFTC investors have taken larger short positions on gold.
It is the lowest since 2001, although the data published is only up to 14th of August 2018,and we know gold has traded higher since then. The news of US President Trump’s comment on the US – China trade negotiations and the replacement of the NAFT, have weakened the dollar Index and this has pushed gold higher.
The move on Friday started after Federal Reserve Chairman Jerome Powell indicated that the Fed’s plans to increase the interest rate is dependent upon the strength of the US economy. ETF has reported they have sold 27,760 ounces from their holdings in the last trading session, bringing a total net stake this year to 409.228 ounces.
Technically the MACD is positive and improved momentum has indicated a buy signal, where we think gold will bought on the dips, and stops will be placed around the $1198-1200 level.
In news elsewhere, Venezuela has announced that it will be selling certificates backed by gold ingots to pensioners, as a saving mechanism or credit lines, as inflation runs at over 100,000%, the certificate is backed by 1.5 grams and 2.5 grams.
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