Today proved to be an interesting day on the futures side of theings. We have been trading in very tight ranges over the last few days. This morning, as I looked up at the futures at 6:30 am, we were trading 1719.4. I went away for an hour and came back and what were we trading? That’s right, 1719.4. But those who got lulled to sleep by the sluggish action were in for an interesting day. A sell-off began shortly after the open taking gold to lows of 1713.8, and options got bid (puts in the front months were the most bid). At that point one might expect to see choppy trading throughout the day, but I was taken by surprise at the speed at which we rallied. When we recovered to 1719 (where we had stalled) I expected to see consolidation (trading in a tight range). Instead we ripped, and in a matter of minutes, we made the day’s high of 1729.9. As the day went on we crept lower until selling off before the options close, and settling, near where the morning started (at 1717). As I write at 4:15 eastern, gold is trading at 1723.2. While we have bounced around both sides of the range, gold looks poised to drop from here. We have had trouble getting above the 1734 level, which should serve as resistance for now. Any move higher should run into resistance at 1750, which we have been unable to breach and hold.
As i wrote this, Greece made another promise; and like the girl that just keeps falling for "the wrong guy" commodities and equities rallied off of their lows. I still favor getting short here, but if we start to see the market caring about Greek headlines again, I would run to the sidelines, as trading on anything sensible becomes a near impossibility.
No comments:
Post a Comment