As a follow-up to yesterday's note on gold, I would advise that open interest rose 16% in Comex gold futures yesterday, to a level not seen since late 2011. The bearish technical reverse, combined with volume being 55% above 15-day moving average and with increasing open interest all point to a strong likelihood that "control" is shifting from the bullish contingent to the bearish contingent. The level of confidence for a 5% sell-off in gold should therefore be increased.
The strength in the dollar index tends to support the notion of lower gold prices as well. I mark a break of a declining channel (dated from March 28) trade in the Dollar Index (dxy).
Yesterday's dollar price action formed a bullish 'hammer' pattern at recent lows.
Note: Please consider a cause I am dedicated to. There is wonderful work done by Elim Christian Services (school). They have provided a loving and supportive environment for our son Ryan (and hundreds of others) to grow toward his God-given potential, notwithstanding his development challenges. Please take a minute and follow the easy instructions on the link below and help me to find another way for my work to benefit this world. I would like to see $3,000 or more raised for this cause...posted before the run on May 7. "GO RYAN" - 6th Annual Elim 5K Walk & Roll.
Thank you to those who have already so generously given.