Gold gave up another 17.60 on Monday, as it struggles to gain any traction here. Gold has been in a downtrend channel since August and we need to see it break out of the tight trading range it has been in this month. Based on the Relative Strength Index (RSI) gold is not oversold at this point (RSI is highlighted at the bottom of the chart).

Subscribers to the Trend Letter are presented with our various Forecast Models, which are dynamic and are updated at the end of each week. Our Forecast Models calculate both bull and bear scenarios. Below is the updated Model Forecast for gold which was sent to subscribers Sunday.

• In both scenarios there is an immediate decline to the 1640 range, then a rally to 1800 by the end of April.
• The bullish scenario sees a decline to 1640, then a rally up to 1940 by June
• The bearish scenario would see a decline to 1640, then a rally to 1800, which would be the high, and then see a prolonged decline into early 2022

If you are not a subscriber to the Trend Letter, we are offering some great discounts to all of our services.  Check the offers below:

 Trend Letter:
Since start-up in 2002 Trend Letter has provided investors with a great track record, giving exceptionally accurate information about where the markets are going, and it has explained in clear, concise language the reasons why. Using unique and comprehensive tools, Trend Letter gives investors a true edge in understanding current market conditions and shows investors how to generate and retain wealth in today’s climate of extreme market volatility.

A weekly publication covering global bonds, currencies, equities, commodities, & precious metals. Over the 20 years Trend Letter has been published, it has achieved an incredible average return of 65% on its closed trades.

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Markets continued their decline today after Federal Reserve Chairman Jerome Powell said that as the national economy begins to reopen, “we will see inflation move up through base effects. That could create some upward pressure on prices.” While the Fed is expecting some inflation, Powell said he does not expect to raise interest rates this year until employment and inflation are back to sustainable levels.

Nasdaq

Another big down day for the markets, with the techs again leading the way down. The Nasdaq dropped another 274 points or 2.11% today  and is now trading down 164 points for the calendar year. After breaking below its 50-DMA yesterday (red wavy line), the Nasdaq has now breached its uptrend line (green diagonal line) dating back a year ago.

S&P 500

The S&P 500 lost another 51.25 points today or 1.34%. The S&P 500 broke below its 50-DMA today, which had acted as a strong support level when tested late January and late February (green arrows).

Insiders are selling

The chart below shows that insiders have clearly decided to sell shares.

Canadian equities

The TSX Index was down as well, but held up better as oil prices surged today.

Bonds

The bond vigilantes continue to challenge the Fed’s policy of low rates and dovish outlook. When investors perceive that inflation, or credit risk is rising, they demand higher yields to compensate for the added risk. The term refers to the ability of the bond market investors to serve as a restraint on the government’s ability to overspend and over-borrow. It will be interesting to see who wins this battle.  Trend Letter subscribers have benefitted handsomely with a recommendation  made in August, betting on yields rising. As we can see on the chart, that recommendation was very timely, hitting the turn within days. That trade recommendation is up 38% since August.

Gold

Gold had another rough day, down 15.15 for the day. The only optimism for gold right now is that it is now oversold technically based on RSI (bottom of chart) so we should see at least some consolidation soon, if not a bounce off these levels.

Bitcoin

Bitcoin continues to be volatile, falling below the $50,000 level today.

Oil

Oil surged to the highest level in nearly two years after closing at 62.83, up  2.55 or 4.15% after the OPEC+ alliance surprised traders with its decision to keep output unchanged, signaling a tighter crude market in the months ahead.

US dollar

The US dollar continues to gain momentum on equity weakness and capital flows, especially from Europe.  With expected increased volatility in the equity markets this year, the US dollar could see a significant rally going into 2022.

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