Marex Spectron Bullion Thoughts

A peaceful morning dawns once again in the Bullion Market. Unfortunately this has been the way as of late and  shows little sign of changing in the near future. Of course, we do have the elephant in the room, namely Donald Trump and this can change things at a second’s notice, but overall the market is quiet, range bound and quite frankly, rather boring.

Last week saw a range of 1293-1311 on spot, an eighteen dollar range over the entire week and it would have been tighter had the unemployment numbers not shaken things up slightly on Friday. This range shows how quiet the market has become as of late. Going back a few months, 18 dollars would have been a normal daily range! The gold market is even more in thrall to the dollar and any Trump tweetings than before and you can see the fx markets and the gold market move pretty much tick for tick in tandem during the day. I don’t see this situation changing but obviously as I have said time and time again this year, with Trump in the White House, anything can and probably will happen. As such, it is worth keeping gold in the portfolio but do not expect much return on it. I would continue to attempt to range trade it and I have found the weekly comex gold options a good way to do this. On the whole, I would look to sell gold anywhere between 1310/20 and buy it back between 1280/90. Keep an eye on headlines, figures and of course “tweets”!!

Today sees the release of Factory Orders, Durable Goods and Capital Goods Orders at 15:00 London time. This could be good for a quick knee jerk reaction in the dollar and gold. Take advantage of any adverse moves if you can.