Goldseek Radio, Released on 12/7/17
- With the holidays just around the corner, Dan Norcini, a.k.a., Trader Dan returns with his outlook on the commodities sector.
- He follows the money flows to decipher investor sentiment, such as the Carry-trade that involves the USD/Yen.
- When the index is weak, sentiment is viewed as risk-on, favoring gold and silver; when the USD/Yen index is strong, the risk-off trade favors US equities.
- The accompanying chart indicates that investors turned to gold in 2016 while avoiding US shares, as the USD/JPY ratio declined.
- The theme reversed in 2017 as the USD/JPY firmed (figure 1.1).
- The host notes that the relationship breaks down out of sample, such as the 2008 credit crisis (figure 1.2.).
- Alternatively, the 50 period MA in the weekly chart or 200 period MA in the daily chart on S&P yields a nearly perfect relationship out of sample (figure 1.3.).
- In addition, the Commitment of Traders report (COT) offers clues by revealing the positions of the big players.
- Our guest outlines specific indicators for the silver market, including the notable correlation with the CRB index.
Dan Norcini is a professional off-the-floor commodities trader bringing more than 20 years’ experience in the markets to provide a trader’s insight and commentary on the day’s price action. His editorial contributions and supporting technical analysis charts cover a broad range of tradable entities including the precious metals and foreign exchange markets as well as the broader commodity world. He publishes his views on the markets in a detailed, fee-based service at Traderdan.net.