PERFECT STORM – Gold, Dollar Index, S&P 500 and Newmont Mining Corp ISIN CODE: US6516391066

Gold to the top of the year – close August 28th, 2017: USD 1306.92


The chart shows the daily trend of gold prices in bar price style and its recent breakout of supply level 1296.95.

InchCapital Platform – Data Source: Fida


Gold breaks out the more important supply line of the year. The bullish breakout that brings the yellow metal to the forefront of the international scenario in terms of current and prospective appeal. The signal is unambiguous and is not only valid in the absolute but also comparable terms.

At present, gold strength is intended to self-feed on condition that it does not record a daily closing of less than 1281.62 with targets that can now be searched at 1334.45 before and 1350.00 / 1375.00 later. These potentials are part of a mid-term bullish project that seeks to achieve 1395.00 in the next three months.


The picture shows three different charts concerning the Gold To Moodys Commodity index (commobities global index) to JPM GBI (global bond index) and to MSCI ACWI IMI TR (global equity index).

InchCapital Platform – Data Source: Fida


The absolute strength of the market is proven by the three compared charts with: the global commodity index Moodys Commodity, the global JP Morgan GBI bond index and the global stock index MSCI ACWI IMI NET TR. As you can note from the three charts below, the performance of gold, in comparative terms, is highlighted with a greater force that is directly attributable to the present indicator below the graphic trends, always in favor of gold.


The bar chart shows the bearish trend of the Dollar Index, an index that compares the US dollar with a basket of five major currencies. The index is testing an important static support present at level 91.91.

InchCapital Platform – Data Source: Datalink


Consequently, the trend of the dollar is likely to be weak and hardened by further prospective depreciation, especially if a prompt reaction is not forthcoming. We refer in particular to the current Dollar Index surveys that are currently testing support of particular importance not only for the next days but also for the medium / long term: level 91,919.

A weekly closing below this threshold will tend to amplify the dollar’s decline and, consequently, the acceleration of gold. If this happens, we expect from now on the progressive loss of ground until reaching the detection area between 84.50 and 82.50.


The bar chart shows the medium/long-term bullish trend of the S&P 500 which has recently emerged from a short-term corrective phase.

InchCapital Platform – Data Souce: Datalink


In this context, the S&P 500 index after recording an extraordinary bullish sequence, featuring an uninterrupted ten-month series, is set to take a break of reflection that can take up to two months.

This circumstance will happen especially if you will experience further weakness in the next two sessions with the involvement of 2435.00 / 2430.00 area. If this happens, we expect from the moment that the correction still underway will tend to accentuate by reporting the surveys in area 2340.00 / 2330.00.


The bar chart shows the bullish breakout in progress of the Newmont Mining stock: one of the main players in the gold sector.

InchCapital Platform – Data Source: Datalink


However, will there be a generalized descent? No there will be stocks that will react better than others due to the passage of the liquidity batons from those like the technology, they have done so well in recent months to others tied to defensive or gold-related sectors.

Among these, the Newmont Mining Corp. ISIN CODE: US6516391066 – NYSE, that stood yesterday by a good bullish signal to bring the title under the spotlight of investors. The perspectives are interesting and let’s glimpse at endless targets at 40.50 and 42.50, provided they do not even record a daily closing below than 36.50 (read more: Newmont Mining isin code US6516391066).