Gold Price

The argument here early in the year was that there was a mild cyclical case in support of gold. The
rally that ensued became outrageous and took gold up to a huge overbought and record setting
long side speculative interest by the summer. The metal was fueled by a fast rising oil price, Brexit
and uncertainty concerning the US election. The oil price has weakened since, Brexit has quieted
down as an issue and players have voted for equities over gold since the US election. Looking out
into next year and with the reasonable assumption the US will see fiscally stimulative fiscal policies,
there is still a mildly cyclical positive case for the gold price to rise. Short term, gold may remain
hostage to a seasonally weak oil price and possible US dollar volatility (See third panel of chart up
next)  Gold Price -- Daily

Gold has swung from a big time overbought to a moderate oversold and sits atop a $1200 - 1225
support zone. Since the knife is still falling, and given gold's natural volatility, only heroes will be
stepping up now. More settled players may wait to see if the oil exporters can reach a production
curtailment agreement that is not set ridiculously high before year's end when another painful
seasonal down leg in the oil price is in store. As well, hedge funds like gold as a haven to park
money when the stock market takes a hit. Since there could be slips between cup and lip for
the current equities story, do not turn your back on gold.