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After a strong rally just shy of the 1300 level, Gold retraced some 6.5% down to almost 1200.
Right now it seems it would like to get a little bit higher again and, as we know markets like symmetrical shapes, it could reach the 1260 level in order to depict a little head and shoulder pattern.
We talk of a head & shoulder beacause we are convinced that the odds are still in favor of downtrend prosecution.

Commitment of Traders

If we look at the COT Index, we notice that despite the recent decrease in price, the commercials are still very very very bearish. If we look at the disaggregated COT (we don't publish it here) we also see that the swap dealers continue to sell this market on behalf of the pension funds (and similar).

gold futures june 2016 commitment of traders cot bearish trading for purpose


Looking at the daily chart, we can see that the price has recently marked a top, facing a resistance level about 1280.

gold futures june 2016 chart trading for purpose

Compared to our video setup of March 14 the price fell just shy of the 1200 level. We now expect a slight rebound, maybe up to 1260, before to resume the downtrend trajectory. So, we are currently waiting for a clear opportunity to short this market once again.

Remember: this is not a trade solicitation and, if you decide to trade, you do it at your own responsibility.
Considering that equities in this period are very shaky, Gold, which is a safe-haven asset, should be favored.
Despite this, we note that, at the end of a parabolic rally, it shows some signs of fatigue.
Therefore we believe that there is some possibility that april 2016 Gold Futures can reverse and begin a retracement towards lower levels.

Commitment of Traders

If we look at the COT Index, the commercials bearish stance could confirm our guess.

gold cot commitment of traders bearish march 2016 trading for purpose

Patterns and Volume Spread Analysis

Looking at the daily chart, we can see that the price is testing the latest top, facing a resistance level.
In recent days we see a shooting star (which can be defined as a pseudo upthrust, according to the Volume Spread Analysis), followed by two spinning tops (or something similar). These are signs of a possible reversal.

gold chart shooting star spinning top bearish trading for purpose

We cannot say with absolute certainty that gold is reversing, but surely it is testing a rejection level and it shows bearish setups.
Remember: this is not a trade solicitation and, if you decide to trade, you do it at your own responsibility.

Is Rice Ripe for a Fall's Fall?

Rough rice price rose from mid-May to mid-August, then retraced a lil' bit and right now it seems about to draw a textbook double top. The August 11 upthrust high volume marked the definitive sellers' entry into the scene and the recent little rally with decreasing volume seems to confirm the possibility of an impending double top.

rough rice daily chart

Only two additional observations: firstly, COT index tells us that commercials violently sold rough rice during the may-august rally and now have reached an extreme bearish stance; secondly, the rough rice seasonal chart shows a possible top around the end of september which this year gives the impression of being able to occur well in advance.

rough rice seasonality chart

In light of all this, we will wait for a clear inversion sign in the daily chart and possibly short it for a nice run till the 11.30 point of control or even till the 10.675 support. As always, this is not a trade solicitation, if you trade it's your own decision... but, anyway, let's hope a good harvest!

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