Room to Move
Tape Watching
Via George Gero
Gold rally to continue after weak stocks, weak dollar underpin bids prior to tomorrow’s option expiration on Comex.
- Calls over 1265-1275 may be active while puts below 1200 could be abandoned
- Going into this we see elevated open interest figures again
- options 1,158,973, futures at 464999,
- options in the money on Comex become futures contracts and need margin money as well.
- Silver still under 200,000 at 193024,
- silver options 125,320,copper 267546,
Tomorrow night we look for higher gold close, higher moving averages, but could have a profit taking sell off Wednesday morning.as some ITM options are converted to futures then sold. Could lose 200k open interest in options.
-G.G.
Plenty of Room to Move
Volumes and Open interest show the market has room to move higher. The descending red line has been pierced today. A settlement above that would be one less upside obstacle to overcome. Option expiration and the April contract could stall the rally. However, the growing uncertainty domestically, adn the EU issues coming to a head (put never quite getting resolved) will continue to bolster support underneath. A six month target of $1310-$1320 is reasonable If we have healthy pullbacks and OI stays under $550k giving us a sign that "hot money" isn't pushing too hard. Healthy pullbacks would be on seeming closure in EU risks. But we all know that just is never going to be over. Any opiating EU news items are a dip to buy in our opinions.
-Soren K. Group
Right now Gold is not looking overbought. Silver however is. Read on.
interactive chart HERE
Precious Metals Commentary
Good Luck
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