Summary

  • Unexpectedly stronger NFP numbers didn’t prop up the dollar significantly, and didn’t hammer down GLD.
  • Higher interest rates and QT talks haven’t been saving the dollar, but they have been clobbering bonds and gold as yields rise. The GLD traders are overly bearish.
  • GLD has been falling since the flash crash on June 27th. The crash likely broke technical levels and resulted in automated selling around the world.
  • Technicals show GLD is about to enter oversold territory relative to the dollar. GLD has already been oversold relative to other currencies such as the euro.
  • A macro-view shows that higher interest rates may not be bearish for gold.

Introduction

It’s been a while since I’ve written an article on gold, part of which has been a result of my moving to a new city. I want to wish everyone a belated happy July 4th last week, and also hope everyone enjoyed their weekends. Now, onto the markets!

I want to start off by talking a bit about the macro-outlook for gold, which I think still remains bullish despite this “higher interest rates” narrative that has caused a frenzy in the bond market. I will then narrow down the focus to the recent economic data, movements in the bond market, the dollar, and GLD, and then finish off with some technical analysis.

Read the full story at Seeking Alpha.