Gold – FX – Dow – 29 November 2019

GOLD: Gold vs US Dollar, Euro and GBP

Gold/USD live price, Weekly update risk analysis relative to Long Term Monthly(LT-M), Medium Term Weekly(MT-W), Short Term Daily(ST-D) and Hourly(not shown) data
(Previous week in brackets)

GOLD: Gold vs US Dollar, Euro and GBP

Close 29 November: 1463 (1462)

Gold/USD LT-M MT-W ST-D
Trend ↓ (↓) ↓ (↓) ↑ (↓)
% Risk
Weight
82 (82) 20 (25) 36 (33)
Allocation 100% (100%)
A flat to weak market during Thanksgiving week ending on a positive note with daily risk weight trend turning positive.
We repeat last week's comment, hence No Change.

Last week: The entire scenario as indicated in all time frames points towards a bottom of gold well above the start of the trend we entered back in Q4 2018. We stay fully invested and with a slightly higher overall recent allocation to total assets.


Gold/EUR live price, Weekly update risk analysis relative to Long Term Monthly(LT-M), Medium Term Weekly(MT-W), Short Term Daily(ST-D) and Hourly(not shown) data
(Previous week in brackets)

Close 29 November: 1328 (1326)

Gold/EUR LT-M MT-W ST-D
Trend ↓ (↓) ↓ (↓) ↑ (↓)
% Risk
Weight
85 (85) 18 (25) 43 (34)
Allocation 100% (100%)
An identical move and similar values to Gold vs USD. Weekly risk weight (Low) looking to diverge bullish vs LT Monthly (high) as well. No Change.

Last week: Just like Gold vs USD, this pair looks as strong technically. The downtrend may not yet be finished as MT trend is still down. We would expect an interim bottom to develop before Christmas well above last year's low. No Change


Gold/GBP live price, Weekly update risk analysis relative to Long Term Monthly(LT-M), Medium Term Weekly(MT-W), Short Term Daily(ST-D) and Hourly(not shown) data
(Previous week in brackets)

Close 29 November: 1132 (1139)

Gold/GBP LT-M MT-W ST-D
Trend ↓ (↓) ↓ (↓) ↑ (↓)
% Risk
Weight
74 (75) 8 (8) 22 (31)
Allocation 100% (100%)
Market appears to find support with daily narrowly turning up and MT bullish divergence developing vs LT. No Change.

Last week: GBP now looks the weakest of the major currencies after a massive run up during Brexshit politics in Q2 and Q3 2019. It means Gold looks even stronger and GBP tax subjects should really consider enlarging their Gold portfolio cash permitting. No Change


SILVER: Silver vs US Dollar, Euro, GBP and Gold/Silver ratio

Silver/USD live price, Weekly update risk analysis relative to Long Term Monthly(LT-M), Medium Term Weekly(MT-W), Short Term Daily(ST-D) and Hourly(not shown) data
(Previous week in brackets)

Close 29 November: 17.00 (16.90)

Silver/USD LT-M MT-W ST-D
Trend ↓ (↓) ↓ (↓) ↑ (↓)
% Risk
Weight
65 (65) 15 (20) 52 (29)
Allocation 100% (100%)
A flat market last week with Silver holding the 17.00 level. No Change.

Last week: Silver actually showed relative strength the past week even though vs USDollar this metal seems to still suffer from long term drowsiness, which is why the market does not trust what will eventually become very evident. A very strong performance is statistically guaranteed. We just don't know when it will finally materialize. The technical picture is very much the same as for Gold this week. No Change


Silver/EUR live price, Weekly update risk analysis relative to Long Term Monthly(LT-M), Medium Term Weekly(MT-W), Short Term Daily(ST-D) and Hourly(not shown) data
(Previous week in brackets)

Close 29 November: 15.42 (15.39)

Silver/EUR LT-M MT-W ST-D
Trend ↓ (↓) ↓ (↓) ↑ (↓)
% Risk
Weight
68 (68) 23 (23) 60 (29)
Allocation 100% (100%)
Daily risk weight moving higher without much price change. We need to watch this development to ensure we do not get tricked into a short term retracement. This till is not the most likely scenario because MT risk weight shows near oversold levels whilst price remains well above last years lows. No Change.

Last week: The Silver EURO story is quite similar and even though price may still weaken a bit, the LT outlook is for a similar bottom to develop with the space of one month. No Change


Silver/GBP live price, Weekly update risk analysis relative to Long Term Monthly(LT-M), Medium Term Weekly(MT-W), Short Term Daily(ST-D) and Hourly(not shown) data
(Previous week in brackets)

Close 29 November: 13.13 (13.22)

Silver/GBP LT-M MT-W ST-D
Trend ↓ (↓) ↓ (↓) ↑ (↓)
% Risk
Weight
61 (61) 7 (8) 43 (29)
Allocation 100% (100%)
Flat market for one month now. MT similar oversold levels as one year ago at much higher price level. This generally translates to being a support signal. No Change.

Last week: Silver vs GBP is the more likely choice for investors. The MT time frame is now rapidly falling into serious oversold ground whilst price has dropped 62% of its last advance rally that started in the low 11 handle. No Change


Gold/Silver Ratio live price, Weekly update risk analysis relative to Long Term Monthly(LT-M), Medium Term Weekly(MT-W), Short Term Daily(ST-D) and Hourly(not shown) data
(Previous week in brackets)

Close 29 November: 86.01 (86.33)

GOLD/SILVER Ratio LT-M MT-W ST-D
Trend ↑ (↓) ↑ (↑) ↓ (↓)
% Risk
Weight
45 (45) 70 (65) 35 (65)
Allocation 50/50 AU/AG (50/50 AU/AG)
The LT Monthly narrowly turned up at a neutral 45 level. This is not a secure oversold or overbought level turn, hence we remain cautious and stay with our fully invested Silver allocation.

Last week: The Gold Silver ratio closing at 85.65 last week still looks for a definitive change of heart. Lack of Silver liquidity may be a reason why the ratio suffers from offloading old positions, probably at a loss. The major opportunity is to hold on to silver and wait for at least a 60 ratio before running scared. No Change


FX: EUR/USD, USD/CHF, GBP/USD, USD Index, GBP/EUR, Bitcoin

EUR/USD FX live price, Weekly update risk analysis relative to Long Term Monthly(LT-M), Medium Term Weekly(MT-W), Short Term Daily(ST-D) and Hourly(not shown) data
(Previous week in brackets)

Close 29 November: 1.1015 (1.1017)

EUR/USD LT-M MT-W ST-D
Trend ↑ (↑) ↓ (↓) ↓ (↓)
% Risk
Weight
13 (13) 47 (47) 21 (38)
Allocation 100% (100%)
If Daily turns up this week it shows a risk weight bottom versus 3 weeks ago with a slightly lower price low on 29 Nov compared to the 14 Nov bottom. No Change.

Last week: It has been just 7 weeks since we rallied away from a long expected Dollar peak and only 1% higher. With LT timeframe having turned up in oversold range any ST pressure will likely find quick support. Risk of sustained dollar weakness is still high. No change


USD/CHF FX live price, Weekly update risk analysis relative to Long Term Monthly(LT-M), Medium Term Weekly(MT-W), Short Term Daily(ST-D) and Hourly(not shown) data
(Previous week in brackets)

Close 29 November: 0.9995 (0.9966)

USD/CHF LT-M MT-W ST-D
Trend ↑ (↓) ↑ (↑) ↓ (↑)
% Risk
Weight
55 (54) 75 (72) 87 (60)
Allocation 100% (100%)
Monthly risk weight narrowly turned up at the 29 Nov close. The dollar advance this past week peaking just above par again looks to be finding resistance too again. No Change.

Last week: For lack of clear direction and a higher risk of dollar weakness we suggest no change to remain fully hedged against dollar receivables


Cable GBP/USD FX live price, Weekly update risk analysis relative to Long Term Monthly(LT-M), Medium Term Weekly(MT-W), Short Term Daily(ST-D) and Hourly(not shown) data
(Previous week in brackets)

Close 29 November: 1.2910 (1.2820)

GBP/USD (Cable) LT-M MT-W ST-D
Trend ↑ (↑) ↑ (↓) ↑ (↓)
% Risk
Weight
41 (41) 86 (83) 63 (62)
Allocation 100% (100%)
GBP performed relatively strong last week. Short term weakness of Cable in the next 2 weeks can be used to add cover for USD receivables as LT risk weight trend is still up. The overall feel is more neutral without very clear direction which could a bit more volatility in the short term. No Change.

Last week: Even GBP looks relatively weak in the currency space, the LT outlook for USD is in fact higher risk. Hence No change. Except maybe to temporarily delay new cover of dollar receivables. Bit of a Treasury play short term at low risk with ST timeframe looking a bit shakier right now


USdollar Index Weekly update risk analysis relative to Long Term Monthly(LT-M), Medium Term Weekly(MT-W), Short Term Daily(ST-D) and Hourly(not shown) data
(Previous week in brackets)

Close 29 November: 98.27 (98.26)

USD Index LT-M MT-W ST-D
Trend ↓ (↓) ↑ (↑) ↓ (↑)
% Risk
Weight
81 (81) 38 (38) 83 (65)
Allocation 100% (100%)
LT Risk weight at same overbought level and pointing down. MT risk is up but neutral level could easily turn back down as LT trend has more weight at the 80 level whilst daily turned down at Month end at the 83% risk level. No Change to remain fully covered on Long dollar transaction exposures.

Last week: T and MT risk are doing catchup without much price development. We could see a bit more ST dollar strength but LT risk remains very high and negative. No Change


GBP/EUR FX live price, Weekly update risk analysis relative to Long Term Monthly(LT-M), Medium Term Weekly(MT-W), Short Term Daily(ST-D) and Hourly(not shown) data
(Previous week in brackets)

Close 29 November: 1.1725 (1.1630)

GBP/EUR LT-M MT-W ST-D
Trend ↑ (↑) ↑ (↓) ↑ (↓)
% Risk
Weight
62 (61) 92 (92) 79 (61)
Allocation 50% (50%)
The month ended on a stronger note (0.8%) against our risk analysis. The risk weight picture shows potential bearish divergence in the daily time frame whilst MT is at an overbought level. This higher risk scenario warrants a careful approach to the value of sterling. No Change.

Last week: We are happy to stay with a 50% cover. GBP for now is holding its own, but we like to see bullish divergence between ST and MT before changing in favour of GBP again. No Change


BTC Bitcoin Price, Weekly update risk analysis relative to Long Term Monthly(LT-M), Medium Term Weekly(MT-W), Short Term Daily(ST-D) and Hourly(not shown) data
(Previous week in brackets)

Close 29 November: 7739 (7268)

BITCOIN BTC/USD LT-M MT-W ST-D
Trend ↓ (↓) ↓ (↓) ↑ (↑)
% Risk
Weight
46 (49) 20 (27) 49 (10)
Allocation 0% (0%)
A very volatile short term experience again with several 5-10% moves within days. No Change.

Last week: We love the crypto space and anxiously await more listings of lesser controlled assets which are properly backed. In the LT picture we can now draw a support line between the 2016 and 2019 bottoms and resistance between Dec 2017 and June peaks giving current support at just under 5.000 and resistance at 11.000. This market looks vulnerable still and without any clear direction. No Change

Remaining 'opening up' gap still to fill at 2828. We exclude weekend action to determine opening gaps as major players are not participating in size.
If this market is poised to turn from extremely overbought (Dec 2017) to completely oversold, it doesn't appear to be finished.


INDEX: US30, S&P500, Brent crude oil

Dow Jones Weekly update risk analysis relative to Long Term Monthly(LT-M), Medium Term Weekly(MT-W), Short Term Daily(ST-D) and Hourly(not shown) data
(Previous week in brackets)

Close 29 November: 28051 (27875)

US30 (Dow Jones) LT-M MT-W ST-D
Trend ↑ (↑) ↓ (↑) ↓ (↓)
% Risk
Weight
92 (90) 96 (95) 91 (67)
Allocation 0% (0%)
LT Monthly at Month end still up at 92% risk. The weekly and daily however turned marginally down at >90% levels. This could trigger a rapid drop hence high risk and No Change.

Last week: Every time we see a new high our impression is that we are reaching the peak of the first stage of a rollercoaster event. And we see increasing support for our technical risk approach from VIP hedge fund managers and general analysts. What is going on in the world of finance in general and with the way sovereign debt is managed in particular is nothing short of the label unprecedented. We stay out of this market. Smart cash into startups with amazing creative potential and Real Estate appears where the balance of excess funds still resides. No Change


S&P 500 Weekly update risk analysis relative to Long Term Monthly(LT-M), Medium Term Weekly(MT-W), Short Term Daily(ST-D) and Hourly(not shown) data
(Previous week in brackets)

Close 29 November: 3140 (3110)

Standard & Poor 500 LT-M MT-W ST-D
Trend ↑ (↑) ↓ (↓) ↓ (↓)
% Risk
Weight
93 (92) 97 (97) 94 (70)
Allocation 0% (0%)
The same analysis as INDU applies to S&P. Lt Monthly could divergence again if MT and ST make it turn down. This is a high risk market and we stay out being aware of an opportunity loss due to maximum high risk awareness. No Change.

Last week: The technical risk of an extra-terrestrial or black swan event can only increase whilst LT timeframes remain extremely lofted. Risk analysis by definition cannot forecast ultimate price development. With extreme log scale price inflation, risk must prevail and remove opportunity in favour of insurance. No Change


Brent Crude oil Weekly update risk analysis relative to Long Term Monthly(LT-M), Medium Term Weekly(MT-W), Short Term Daily(ST-D) and Hourly(not shown) data
(Previous week in brackets)

Close 29 November: 60.73 (63.50)

Brent LT-M MT-W ST-D
Trend ↓ (↑) ↓ (↑) ↓ (↑)
% Risk
Weight
27 (29) 41 (42) 65 (75)
Allocation 0% (0%)
Brent took a dive late last week and closed strongly down (5%) for the week. All time frames are now down signalling a risk of further undefined and unpredictable weakness. We must wait for a strong low risk weight indicator to enter this market again with a more serious asset allocation. No Change.

Last week: We saw a mid week range which would have meant a poor trade if the Hourly had not indicated an oversold condition at the stop level. We await month end to possibly enter a fresh position. Oil still looks very undecided in all time frames. Speculative ST opportunity aside. No position, No change

Posted in A - All Financial Blogs | 2020 Forecast.