The Midas Touch Gold Model™ as of February 17th, 2019
Gold finished the week with a bullish close above 1,320 USD. Bulls remain in control and the expected spike towards around 1,350 USD remains very realistic over the next few days or maybe weeks.
At the same time, our Midas Touch Gold Model™ is in neutral mode, indicating that the air is getting thiner and thiner for the bulls! Of course, general public perception is getting more and more bullish, pushing all the amateur traders into the slaughterhouse…
Gold simple monthly chart as of February 17th, 2019
Interestingly enough, the monthly chart for gold is just a few dollars away from a pro-cyclical buy signal. But these type of signals on the monthly chart usually come in very late and are basically just conforming the last six months of price action.
Gold simple daily chart as of February 17th, 2019
Zooming into the daily chart for gold, the model added a new sell signal during the week when gold pulled back towards 1,302 USD. This is probably just irritating “short-term noise” as the daily chart only needs to move above 1,325.05 USD to flip this signal towards bullish again.
Positive are in any case the new buy signals for gold in Indian Rupee and Chinese Yuan. The strong outflows (minus 9 tonnes) from the inventory of the largest gold ETF (GLD) on the other hand are a negative signal. They might imply that the last leg of this six-month up-wave is (as usual) only happening in the paper markets for gold! Note that exaggerations in the gold market are never backed by physical demand…
Conclusion
Gold remains in a strong uptrend and has very good chances to reach the massive horizontal resistance around 1,350 USD. But now is not the time to be brave in the precious metals sector. Instead tighten your stops and continue to take some speculative money off the table. While we have a runner left to cash in, preparation are being made to place a swing trade short on gold once we have reached around 1,350 USD. The next larger wave will be down!
Florian Grummes is an independent financial analyst, advisor, consultant, trader & investor as well as an international speaker with more than 20 years of experience in financial markets. He is specialized in precious metals, cryptocurrencies and technical analysis.
He is publishing weekly gold, silver & cryptocurrency analysis for his numerous international readers. He is also running a large telegram Channel and a Crypto Signal Service.
Florian is well known for combining technical, fundamental and sentiment analysis into one accurate conclusion about the markets.
Since April 2019 he is chief editor of the cashkurs-gold newsletter focusing on gold and silver mining stocks.
Besides all that, Florian is a music producer and composer. Since more than 25 years he has been professionally creating, writing & producing more than 300 songs. He is also running his own record label Cryon Music & Art Productions. His artist name is Florzinho.
