"As a technician, I feel that there are few analysts that offer value for me, but you do. Your work on Gold ratios has helped my analysis greatly." --Jordan Roy-Byrne, CMT (The Daily Gold) 4.9.10

Tuesday, January 25, 2011

Gold This Morning: On the Good Ship Lollipop --Jon

Heavy overnight trade with prices being whipped like a rented mule all the way down to a current low of $1321.90 from where we have bounced with the impact of a block of jello and while I fear we may still have to endure more selling before we load up the truck, the facts haven't changed folks just that the sentiment is as nasty as recent reviews of Spiderman. The GSR is again elevated this morning ~49.60 but hardly provocative that our world awash in readies is about to get tight. Open interest is ~580,000 and a solid 10% less than last fall's so-called bubbly number. RSI this morning is at 32, and as far as I am concerned that is a pound the table number based on that same level being the exact launch pad for last summer's move. Roll into this mix that FEB options expire tomorrow and the roll is on out of FEB futures and into April; I'd add that option vols are beginning to elevate for the first time in several months, but are still cheap ~17. Outliers? Ireland, rate hikes, municipal or state shortages, State of the Union...got gold?  http://www.biiwii.blogspot.com