The 11/16/24 blog “Gold Sentiment – November 2024” noted that Gold could make at least an intermediate bottom by late December 2024 or early January 2025. As of 12/06/24 it appears Gold could continue trending lower.
The weekly Gold futures chart courtesy of Barchart.com updates Gold sentiment.
The Commitment of Traders (COT) tracks the net positions of three groups, Commercials, Large Speculators, and Small Speculators. The Commercials are the group to follow because they hold the most Futures contracts. Significant price peaks are where Commercials usually have their largest net short positions. As prices decline they reduce the short position.
As of early December 2024, the Commercials red line is trending higher – a reduction of net short positions. If prices continue lower the net short position is likely to continue to shrink.
The daily Dec Gold Futures chart courtesy of Trading View zooms in on the more recent action.
From 10/30/24 to 11/14/24 Gold declined 9% then rallied into a secondary peak on 11/25/24. What followed was a micro crash which bottomed out on 11/26/24. The subsequent rally has been weak forming a rounding top. A break below the 11/26/24 bottom could lead to a test of the important 11/14/24 nadir.
Daily Stochastic, RSI, and MACD are neutral.
A break below the 11/14/24 bottom opens the door for a move to chart support in the 2,300 area. Time zone is late December 2024 to early January 2025.
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