by Bill Downey     Price Analysis of Gold and Silver
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Technical Analysis Trading Gold, Trading Silver/ analysis By Bill Downey providing key turning points & charts for investors and speculators in Precious Metals Trading, and Precious Metals Markets

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Gold and the week of Thanksgiving

22 Nov 2016 10:23 AM | Bill Downey (Administrator)

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Gold for the week of Thanksgiving


Key things for gold this week

Thanksgiving is always a tricky week in which to trade because we have options expiration and a major USA holiday (Thanksgiving) to deal with.  In other words, the week can be heavily influenced by the control boyz.  

That doesn't mean that gold always moves lower.  But it does mean the control boyz have a much easier time setting up the market in a manner that could be beneficial to them either immediately or down for the following week.  Volume dries up by Wednesday on the COMEX, and its closed Thursday for Thanksgiving.  

While Friday is open, the majority of market participants (traders & speculators) are for the most part absent until the following Monday.  

Since the majority of gold trading takes place in New York, that means volume is low and this is where the control boyz have much opportunity to either spike the market lower (or higher) or test support areas that is important to how they would like the market to set up.  

There have been Thanksgiving holidays where we've seen 50 to 70 dollar moves and there have been some where the price barely budges.  

Thus it's a week that should be taken in context and one that is an excellent week to not trade and go on holiday yourself.   I cannot emphasize in words how good it is to take breaks from watching and trading markets and Thanksgiving week gives us that opportunity.  One should take advantage of this and get away from the market for a few days if at all possible.  

Now you might say,  what ?  Take a few days off and miss a potentially important opportunity?

If you think that way you may be a lot more "addicted" to the market than you think.  And that can be dangerous.  

If your a trader, rest assured that the market has always in the past (and will always in the future) give opportunities for trade set ups for those who are patient.  If your an investor, a buyer of physical gold, it shouldn't matter not watching the market for a couple of days.  Take advantage of this week to recharge your batteries as there are not many weeks we have this luxury.   All work and no play---makes Jack a dull boy. 

For the week

December gold options expire on Tuesday Nov 22nd.  There are about 7000 put options at the 1200 strike price that expire today (thanks to Evert P. for that info).  Thus we'll find out after today if 1200 is going to hold and just how much MOJO gold has left in it's bullish bag.

In addition, minutes from November's FOMC meeting will be released on Wednesday during light holiday trading due to Thanksgiving. They never miss a beat.

Today is the last real day of volume due to Thanksgiving holiday in USA.  Unless the control boyz have a raid planned, gold should be quiet and remain in the 1199-1230 area for the week.  If gold takes out 1195, look for a move to 1172-1182.    The chart below shows resistance is most likely in the 1222-1230 area this week and support 1195-1205.  If we look at last weeks action and price pattern, it was choppy and overlapping.  It tried to make the 89 hour moving average support but when it failed, gold plunged.  Now look at this week.  Same choppy and overlapping pattern and at the moment trying to hold the 89 hour moving average.  Its best to remain cautious before we get any bullish notions at the moment. 


On a monthly basis, the 1222-1226 area is where the moving averages reside.  As long as price is below that level, extreme caution is recommended.   The last day of the month is when the moving averages come into play.  A close below them (BUT MORE IMPORTANTLY BELOW 1200) on the last day of the month will most likely favor a test of 1095-1122.

Right now

Gold tested 1201 on Monday.  The May 31st low is 1199.  This is currently the most important support for 2016.  The question is this---will the control boyz allow for this area to hold or will they carve out the final STOPS to set up a test of 1172-1182?  It's certainly their chance with the holiday and low volume scenario.  Let's discuss 1172-1182.

 

There is one more area before 1095-1122 that is important.

While the 1200-1220 area is certainly important so is 1180.  1180 is the 2013 low and if gold can't hold that area, then a move towards 1095-1122 will become the odds favored target in December. 


If you're stacking physical gold the 1180 area would be a good place to add to your stack, but keeping in mind that it is not out of the question for gold to test 1095-1122.  

In summary, gold remains under pressure, and we favor that the low from this correction will occur between November and January of this year.  From this coming low, prices should move higher in 2017.  



Technical Analysis :: Gold & Silver

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