Is Gold About To Plunge? | The Mesh Report

Is Gold About To Plunge?

Mike Hammer November 18, 2016 0

Here at The Gold Enthusiast we focus on trading first, explanations second, speculations last. Lots to look at today so let’s get right to it.

Trading will be the main focus today. US Fed reps made no secret this week of their intent to raise interest rates, and soon. This is no surprise, as the election is over and the Fed needs to get some room to operate in the future. Many have argued lowering the current almost-zero rate would have little to no effect on the market. And, the market showed signs this week of pricing in an interest rate hike.

As a result, this hasn’t been a good week for gold bugs. When interest rates go up, gold typically falls, in the absence of a major geopolitical issue causing uncertainty.

On to the trading. Each day this week GLD managed a high above 117, but couldn’t get through resistance there. Yesterday GLD managed to close above 116 following an afternoon drop into the 115’s.

In pre-market trading this morning, GLD briefly fell below 115 and sits at 115.50 as I write this.

You will recall that 115 is our current most-bottom-support level. As believers in support and resistance, this tells us that if GLD heads below 115, and most importantly closes below 115 today, it’s a sign that further drops are more probably coming.

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