Gold Miners
Jack Davis | Jan 06, 2017 11:52
Originally published by Chamber of Merchants h2 USA Gold Miners Rally Overnight/h2
Let’s have a quick look at the performance of gold miners in the USA overnight:
GDX (NYSE:GDX) the gold miner’s index, rallied 6%:
The VanEck Vectors Junior Gold Miners (NYSE:GDXJ) rallied roughly 9%:
Gold broke above $1180 USD:
And this is all due to two things:
Bond Yields are retreating (caution…yields are at a support zone here…)
And the US dollar, which has plummeted over the past few days (caution, we’re at support here):
So will yields and the dollar drop through their support zones? Or will they bounce and send gold down for a few days?
Well..it really depends on these numbers tomorrow:
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The most important numbers above are the unemployment rate and the non-farm payrolls rate.
The gold sector will have major gains today.
Whether it keeps those gains depends on whether the unemployment rate and non-farm payrolls are disappointing or not.
To some extent, Australian gold miners will be buffered by the exchange rate either way. However, what we really want is global sentiment toward gold to be positive. Therefore we’re looking for disappointing economic numbers to thwart the threat of interest rate hikes any time soon.
There’s a high probability that the ASX All Ordinaries Gold could trade up against the 4400 mark, However whether it breaks through or not is irrelevant as the rally will be fueled further or subdued by the data out of the USA tonight.
Meanwhile, Australia will be reporting the following which will affect the Australian dollar:
Bad news is good news for the gold sector…. Poor numbers will pressure our RBA into cutting interest rates… which weakens the Australian dollar in advance.
Big day.
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