How To Make A Camel Vomit Gold

Ladies and Gentlemen, 

Has Gold lost it's shine? Gold traded near a 5-year low as investors continued to short bullion-backed equities pricing in expectations for the US to increase interest rates this year, further Rusting the Metals Market. 

Gold is heading for a thirds year on year decline as investors now brace themselves for a first interest rate increase since 2006 and according to the "theory" - Higher Rates = Less competitive metals. But Why? It is simple, as the Metals offer no dividend, hence investors naturally flock to other assets that pay interest or offer dividends.

Can we head below $1000?
(Figure Below) Source : CNBC

What is now known as the "Vomiting Camel" (from the formation of the two humps [yearly highs]) - we now have the camel resting on a rhombus, indicating that a break below current levels =  free-fall! 

The Splat Zone indicated on the char signals towards the $700-$800 for possible areas that Gold could fall into post December hikes. 

But what about Central Banks, The Russians & Chinese - are they still buying? - Yes! Gold purchasing (And Demand) is at record highs, as both Russia and China still maintain a policy to hedge against their currency & they will probably remain net buyers. China for example, added an extra 14 tons in October. 

So what happened to Economics? Well, we have to remember that XAU is backed by the USD and experts point to a "Bear-Market" cycle driven by the FED. But in my view, if we do see a hit of $700-$800 we could see a spark in the bulls.

Absolutely a fascinating time to be watching the markets. 

Trade Smarter,

Anish8FX@Atom8.com