Gold price opens up the week higher after ANOTHER friday gold-slam – now fully retraced
Last Friday we were ‘treated’ to another gold-slam that took the price down some $30 in a matter of seconds – the amount of gold sold during this short period was massive, coming in around 800,000 ounces. Usually, if you has so much of something that you were trying to sell, you’d do it over the course of the day/week to try and get the best price – whoever did the selling on Friday did it in one-hit, guaranteeing that they would get the worse price and plunge the gold price in the process.
And this isn’t the first time this has happened this month – it’s happened a least five times, but the regulators in the US don’t seem to care.
Gold $ (30 mins):
You can see that sell-order hit the tape just after 13:00, taking the price as low as $1260. However today gold has taken back ALL those losses.
On the daily chart the head and shoulders bottom chart pattern (discussed here) is still in play – but only just.
Gold $ (daily):
For the gold-bulls to breath a sigh of relief then, the’ve really got to recapture $1300 at a minimum – if they don’t then that ‘mystery’ seller might just show up again with one-eye on that June low of $1180.
It should be no surprise that ‘someone’ wants to get the gold price down, after all there’s only four days left until the US once-again defaults on its obligations – the last ‘default’ came in August 1971 when the US government said it would no long honour the gold claims backing the dollar, meaning that countries would no longer be able to convert their dollars into gold as agreed. The ‘people’ lost this ‘privilege’ in 1933 when FDR made it illegal to own gold, another default on its obligations.
And a defaulted-on dollar is about the most bullish set-up for gold you could imagine – only just beating-out the second most bullish set-up for gold, which is a non-defaulted on dollar, but with a massive rise in the debt-ceiling (see the link between the debt-ceiling and gold here).
Or in other words, gold should be absolutely flying right now – but it is being contained because when the oh-so predictable 11th hour and 59th minute debt-ceiling hike is confirmed, gold should react very positively. So what better way to keep the price of gold down (and defend the dollar in the process) than to make sure its starting from a much lower base than it otherwise would.
There is one country who is absolutely loving these gold-smashes – China. After-all, they’ve been dropping hints they want to drop the dollar in favour of a gold-backed Yuan.
Grab your pop-corn, it’s going to be a VERY interesting week for gold.
Link to this article: : http://www.goldmadesimplenews.com/gold/gold-price-opens-up-the-week-higher-after-another-friday-gold-slam-now-fully-retraced-11944/