Yesterday:

Nothing particular exciting happened in Gold pricing, despite PGM and Silver weakness. Futures seemed to ignore USD movement. At 2pm ET when the Fed released their notes, Gold spiked for no particular reason. The Fed notes were not bullish gold, bearish dollar, nor bullish equities.

 

The market finished softer as the USD firmed up in line with what we handicapped in the chatroom *Drill Down: Powell, Math, and QT.*

 

So Far Today:

Starting last night around 11pm US ET first diver, then gold broke VBS Levels indicating an increased momentum lower. This was not a tradeable signal to open a position by our risk/reward parameters: but was textbook “get out if you are long” and/or “wait a bit if you want to buy”. The market stabilized as London liquidity showed up between 12-4 am and is now back lower as we write this trading 1219.50 In Z futures. 

 

 

 

 

 

 

 

 

Data On Deck:

The US reports October producer price and the University of Michigan’s consumer sentiment and inflation expectations survey.  Although economists can tease out some insight for consumer prices from the PPI, it is not typically a market mover.   It has been a busy week for US participants, with the midterm election and the FOMC meeting behind them, participants welcome the weekend.  The Fed’s Williams and Quarles speak in the morning now that the quiet period ahead of the FOMC meeting has ended, while the Fed’s first formal report on Supervision and Regulation will be released.    The Dollar Index is up about 0.35% on the week (@96.85).  If the gain is sustained, it will be the sixth gain in the past seven weeks.  The high for the year was set at the end of October near 97.20. Our next test is around 98.00.   H/t Marc Chandler

 

Yesterday’s Trades:

Nothing particularly stood out and nothing was done on our own algo “brown” box system. Technical traders would likely have been biased bearish and point lower again today. 

 

Other Money:

 

Outside Markets:

 

Tape Reading:

As universally expected the Federal Reserve did not change policy yesterday.  Its assessment of the economy was essentially unchanged. Growth is strong.  Unemployment is low.  Inflation and inflation expectations stable.  Gradual hikes will continue. Barring a major shock, which is more than a correction in the stock market, the Fed will raise rates in December.

*Drill Down: Powell put- investing vs. active trading landscape*

 

Technicals via Moor Analytics:

 

Today’s VBS/ RTM Levels:

Spot Daily: 1234.50- 1218.90 (High Quality) On Radar 

Gcz Daily- 1236.90- 1221.52 (High Quality) Will Trigger. 

Other Time Frames:    

 

Learning Moment:

We noted the USD strength, Euro weakness and softness in stocks right after the Novotny commented on ECB (in)ability to buy junk grade bonds, and that Italy wasn’t ‘in crisis yet’. This alerted us to whatever weak hands were out there would be susceptible to US FOMC wording that reinforced the rate hike path. This proved a lesson worth relearning. 

 

Mining Stocks:

Starting Monday

 

Have  a good weekend!