Gold just entered into a death cross, and we see more pain aheadAt the time of writing, this report Gold and Silver prices are slightly down. we informed you in our previous report about the possibility of the yellow metal to make the slight correction which could take the prices up to $1300 per ounce and we have already witnessed that on last Friday. Well, the credit for this small correction goes to the sharp drop which we witnessed in the U.S jobs report last Friday however as expected the small correction wouldn't hold longer and prices fell back today which drag the yellow metal prices to $1290.Bulls are already arguing about the double bottom which formed in the gold chart exactly at $1280 per ounce and talking about the likelihood of the yellow metal to break above $1350 or even $1400 this year. well keeping the uncertain nature of the market in mind of course anything is possible but in our opinion most of these folks are either newbies or take gold as a cult where they always talks or hopes about the drastic increase in PMs prices but unfortunately market doesn't work on hopes, They often say “History doesn't repeat itself but it often rhymes and we couldn't agree more. As a gold-silver analyst it's our duty to analyze other market participant perspective as well without getting attached to our current position in the portfolio, The argument of the double bottom at $1280 seems valid however due to numerous long term factors which we will discuss in our upcoming report we think it'll be short lived and once yellow metal will break below $1270 level more doors for seller swill open which will damage the chart even more. By keeping all the factors in mind including little risk and enormous reward perspective it seems our short position is more than justified which have the full potential to add enormous gain in our portfolio.
The weak jobs report which came out last Friday was surprising for many as we saw the steep decline in the growth chart of non-farm payrolls while China's latest export and import figures were down. The China-Trade war has caused more trouble to Chinese economy than USA Which is making Chinese leadership keen to end its trade war with the U.S The unofficial China purchasing managers’ index (PMI) came in at its lowest level since October. China has also reduced it's projected to gross domestic product growth for the year. As China is a major consumer for gold, there slowing Chinese economy is a good sign for bears.
U.S. Federal Reserve Chairman Jerome Powell, in a rare TV interview on Sunday, reiterated the U.S. economic outlook is favorable and said there is no need to raise or lower interest rates at present.
