A few charts to ponder as the week progresses...

Regards VHF

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The summer seasonal trade in gold bullion came to an end yesterday. Stochastics fell below 80% and gold’s daily trading range fell below its previous daily trading range. MACD and RSI also have recorded short term sell signals.

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Gold stocks are responding to lower precious metal prices. Goldcorp and Kinross broke support and established intermediate downtrends. Other big cap gold stocks are testing key support levels.

Chart courtesy of StockCharts.com www.stockcharts.com

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Chart courtesy of StockCharts.com www.stockcharts.com

Seasonal influences for gold have a brief period of weakness followed by a revival from the second half of November to early February.

Silver also has favourable seasonal influences from the second half of November to early February. Silver tends to outperform gold during this period.

Charts courtesy of SeasonalCharts.com www.seasonalcharts.com

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Trigger for weakness in gold and other commodities yesterday was strength in the U.S. Dollar. Short term momentum indicators for the Dollar turned positive. Upside potential is to the Dollar’s 50 day moving average currently at 76.95. Intermediate trend remains down.

Chart courtesy of StockCharts.com www.stockcharts.com

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A major reason for strength in the U.S. Dollar yesterday was an increase in U.S. long term interest rates. Ten year Treasuries added 0.08% to3.59%, a ten week high.

Investors are responding to the plethora of Treasury issues coming to market this week.

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The S&P 500 Index, Dow Jones Transportation Average and TSX Composite Index broke their intermediate uptrend yesterday.

Chart courtesy of StockCharts.com www.stockcharts.com

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