Gold Sentiment - Determining Trade Direction

*Gold Sentiment Calculator (in development)*

I want to start tracking updates/changes to indicators of long term sentiment for Gold.

Evaluation criteria

1. Fed rate expectations
2. Trend durability
3. Global Stability
4. GLD put/call ratio
5. US 10 Year Treasury Yields

Criteria classifications

1. Very Bullish
2. Bullish
3. Slightly Bullish
4. Neutral
5. Slightly Bearish
6. Bearish
7. Very Bearish

I will use this list of indicators as frequently as daily to determine what direction I will allow myself to place gold trades - if I decide to make any at all. This list should be combined with additional analysis such as technical levels for entry/exit when determining whether or not to place a trade. Hopefully this will help increase trading performance over time as more indicators are added.

Resources
https://www.cmegroup.com/trading/int...n-to-fomc.html
https://www.investing.com/central-ba...d-rate-monitor
https://marketchameleon.com/Overview/GLD/OptionSummary/
http://www.optionistics.com/put-call-ratio/GLD

06.24.19 sentiment: Very Bullish

Fed rates - Very Bullish

CME FedWatch has rates going lower in July and the general sentiment beyond that is lower as well.

Interesting thread, I'm always looking to test out new sentiment indicators.

Sentiment for gold could be tough... For equities there's a lot of good indicators like AAII, but I don't know of anything like that available for gold. One thing you might be able to use is the GLD put/call ratio to get an idea of how disproportionate positioning is.

How are you using the Fed Watch tool?

That’s a good idea!

I plan on using the Fed Watch tool for two things atm. Pure interest rate direction and its impact on gold prices regardless of how much is already priced in as well as the shifts from day to day in expectations assuming that the trend will continue more often than it reverses.

06.25.19 sentiment: Bullish

I'm slightly downgrading the bullish sentiment today for gold.

Trend durability - Slightly Bullish
We had bearish impact news today for gold prices and the asset sustained the impact relatively well. My conviction would be much stronger if gold could have resumed into 1435 territory but today is still an up day on the daily candle and I think that speaks for itself. There of course will be down daily candles some days during a bull market and today was not one of those days.



Fed rates - Bullish
My monitor of the fed rates still indicate bullish sentiment but the change from yesterday is less bullish than it had been.

06.26.19 sentiment: Bullish

I'm slightly downgrading the bullish sentiment today for gold.

Trend durability - Slightly Bullish
No change from yesterday.

Fed rates - Bullish
My monitor of the fed rates still indicate bullish sentiment, the change from yesterday is pretty insignificant.


Global Stability - Very Bullish
With trade wars, the Iran conflicts and uncertainty of leadership at the Fed stability has been in question right now. This has manifested itself in volatile equity markets and bond yields that dipped below 2%.

06.27.19 sentiment: Bullish

I'm maintaining the bullish sentiment today for gold.

Trend durability - Bullish
I moved the indicator a notch up from yesterday. There was very little market moving news today for gold and yet it continued its uptrend to the tune of ~1% gain on the day. There was some negative impact news earlier this week as well from Bullard, Powell and the Fed generally. The fact that the trend up is continuing signals a bullish sentiment in the markets.

Global Stability - Bullish
I think I may have exaggerated how bullish the state of global stability is yesterday. We are certainly still in a bullish environment for the reasons mentioned earlier but it would take more to be considered very bullish.

Fed rates - Bullish
My monitor of the fed rates still indicate bullish sentiment, no change from yesterday.

06.28.19 sentiment: Bullish

I'm maintaining the bullish sentiment today for gold.

Trend durability - Slightly Bullish
I moved the indicator down a notch from yesterday. G-20 news already seems to have caused some downward momentum in the prices of gold today and the trend does not look as healthy when tracking the movement overall. The gold market has cooled off a bit but that could all change coming into next week. Wait and see

Global Stability - Slightly Bullish
I downgraded this measure for similar reasons as the above. There appears to be some expectation that G-20 will go over well which will improve the perception of stability. Careful though because it could easily start that way and then all blow up in a single Trump tussle afterward.

GLD put call/ratio - Very Bullish
With a ratio of 0.62 it is safe to consider this a bullish indicator and has been trending much more bullish lately as well. Props to Ef5 for suggesting this indicator, it is certainly a worthy addition to the tool chest.


Fed rates - Bullish
My monitor of the fed rates still indicate bullish sentiment, even more-so than yesterday.

Thanks, I'm glad you were able to find it somewhere! Its not as commonly available as I expected.

I was looking for this!! Thanks

07.01.19 sentiment: Slightly Bullish

I'm downgrading to a slightly bullish sentiment for gold. There have been too many downgrades in the indicators I am tracking to say otherwise. I definitely need to add indicators to my list soon in order to have an accurate sentiment but I think I am close enough for longer term trading and can postpone some of that leg work for when I have more time.

Trend durability - Neutral
I downgraded this measure, after a few news items over the weekend we saw a significant gap in gold prices that has yet to be filled through Monday trading. There is currently no evidence that the upward trend we saw earlier will hold momentum.

Global Stability - Neutral
I downgraded this measure again due to a lot of positive news related to US relations with Asia. G-20 was a de-escalator but that could easily be erased so keep your eyes open here.

GLD put call/ratio - Very Bullish
I found a more timely reporting of open interest numbers and it looks like there is a ratio of 0.567 at the moment. Even if the ratio stands at 0.6 we are very bullish on this indicator right now and that has not changed.

Fed rates - Bullish
The fed rate expectations are not quite as bullish as yesterday but still fall in the same realm as previously. It's possible I will downgrade to slightly bullish tomorrow depending on the movement.

07.02.19 sentiment: Bullish

I'm upgrading to a bullish sentiment for gold. The downgrades of yesterday were short lived and the indicators have swung back in gold's favor. The next indicator I plan on adding will incorporate bond yields as I have been wanting to track this indicator since they fell below the 2% mark. I think that they will help illustrate why we are in a bull market right now.

Trend durability - Slightly bullish
Today has definitely increased my confidence in the gold rally. Gold covered the gap from last weekend but didn't have a ton of reaction to the news about the supposed white house emergency as one might expect. There was also Chinese data that came out today that has pulled prices down a bit from the upward trend which is only slightly concerning while still developing.

Global Stability - Slightly bullish
The downgrade here was premature. There are rumors of conflict right now and I have a feeling that some news will break in the next week that impacts the markets. Stay tuned.

GLD put call/ratio - Very Bullish
The ratio stands at 0.552 now and has been moving more and more bullish over time.

Fed rates - Bullish
The fed rate expectations are 72.4% of 200-225bps and 27.6% of 175-200bps. This is more bullish than yesterday and continues the bounce back and forth in expectations right now.

07.08.19 sentiment: Bullish

I'm maintaining a bullish sentiment for gold today. Currently the weakest indicator I am tracking lies with the trend durability that gold has displayed the past week. I am not very surprised by this though considering how far and fast the price rose in June. It seems gold has a bit of a hangover. Even so a slowing trend is a concern but I do think we will see another leg up in the near future. I also started tracking 10 year US treasury yields. I have been watching yields for awhile but was not yet jotting them down here. I think I will add the yield curve into the equation as well.

Trend durability - Neutral
Looking at the daily candles shows that the uptrend in gold prices is slowing and looking at 5 min bars for the past few days shows that news like NFP last Friday have been able to suppress such trends with no real comeback in price.

Global Stability - Bullish
Trade talks between China and the US are still in flux, Iran is attempting to enrich uranium (breaking the nuclear deal) and Deutsche bank's restructuring could be a signal of wider banking issues forming

GLD put call/ratio - Very Bullish
The ratio stands at 0.556, and looks to float around these levels for a bit.

Fed rates - Slightly Bullish
The probabilities for fed target rates are 94.1% of 200-225bps and 5.9% of 175-200bps. This is less bullish than recently as we approach the meeting but there are a number of analysts who think expectations are too dovish.

US10Y - Bullish
Yields on the 10 year treasury (and consequently bonds) have dropped to a very low point these past weeks. In fact the US10Y hit a two-year low (1.94%) at the end of last week. We had a slight rebound since then but yields are only sitting at 2.04% at the moment.

07.09.19 sentiment: Bullish

I'm maintaining a bullish sentiment for gold today. Very little has changed since yesterday (I have all categories the same) but I'm thinking we will see some movement tomorrow.

Trend durability - Neutral
No change here from yesterday. There have not been any notable events in the market and price is just drifting. Time is starting to run thin though if we want to consider gold still trending over a longer period of time.

Global Stability - Bullish
Trade talks between China and the US have made some slight progress but otherwise we are really in the same boat we were yesterday.

GLD put call/ratio - Very Bullish
The ratio is currently at 0.566, and looks to continue floating.

Fed rates - Slightly Bullish
The probabilities for fed target rates are 98.2% of 200-225bps and 1.8% of 175-200bps. The market seems to have made up its mind. We will have to see where we go from here.

US10Y - Bullish
Yields on the 10 year treasury have continued to recover albeit modestly at 2.07%.

07.10.19 sentiment: Bullish

I'm maintaining a bullish sentiment for gold today. It is refreshing to see my sentiment has finally been reinforced by price movement, gold is back to trading at 1423.84 atm. Gotta stick to your guns out there .

Trend durability - Slightly bullish
We saw some very positive news today for gold prices, the trend looks to have good odds at continuing at this point. There was not really any negative news today so we will have to wait for more evidence of how price reacts going forward.

Global Stability - Bullish
There was more drama with Iran today as a fleet tried to seize a British tanker. Other global conflicts mentioned earlier are more or less in the same spot.

GLD put call/ratio - Bullish
The ratio is currently at 0.571, we may be seeing a slow drift up here so I'll turn the signal a notch down to be on the safe side.

Fed rates - Bullish
The probabilities for fed target rates are 71.4% of 200-225bps and 28.7% of 175-200bps. After some comments from Powell we seem to be back where we started earlier in this thread. I mentioned two days ago that there were some skeptics on how dovish the markets had priced in the forecast and it looks like there is substance to that claim after all.

US10Y - Bullish
Yields on the 10 year treasury dipped again to 2.04% any lower and there maybe an upgrade in order.

07.15.19 sentiment: Bullish

I remain bullish on gold today. All signs point to gold up except for this calm in the trend-line price. Keep an eye out for a significant price movement in the next 2-5 days, a wedge has been forming on the daily candles as price volatility has decreased and I am feeling a breakout move. Will be fun to check back here early next week.

Trend durability - Slightly Bullish
The trend is starting to run out of time to resume but we did see a big beat on the NY Fed's manufacturing number today and gold recovered pretty nicely. Let's keep an eye out for the next day with bullish or neutral news releases.


Global Stability - Bullish
China recently released very low GDP numbers, the US has debt ceiling issues cropping up again and the trade war/Fed uncertainty/Iran conflict etc have not been resolved. Staying bullish here.

GLD put call/ratio - Bullish
The ratio is currently at 0.570, I think it warrants a 'Bullish' designation but will consider an upgrade in the future.

Fed rates - Bullish
The probabilities for end of July Fed rates are 70.3% of 200-225bps and 29.7% of 175-200bps. I suggest remaining bullish here.

US10Y - Bullish
Yields on the 10 year treasury are up a bit at 2.09%, bullish is appropriate today.

07.17.19 sentiment: Bullish

I remain bullish on gold today and the bullish signals are getting stronger at least based on what the market is doing. Two days ago I mentioned that all signs pointed up except the trend line and I think it is playing catch up, the question will be how high it goes and whether it breaks the recent top around 1438. I would not be surprised if a new high is reached at least by the end of the month and that could cause an interesting run. Opportunity bells have been ringing this week

Trend durability - Slightly Bullish
Price movement today renewed faith that the trend will continue but we will have to continue watching to see what happens at the 1437 level. There doesn't seem to be much news that slowly but steadily pushed gold higher today so that is a pretty good sign gold is trending. I'm tempted to upgrade this indicator soon but it is still early.

Global Stability - Bullish
Things with China seem to only be getting worse as Trump flexes his muscles on how heavy handed tariffs can be. Otherwise I have not seen much of an update on the issues hanging around out there.

GLD put call/ratio - Bullish
The ratio is currently at 0.579 - less bullish than previously but still bullish.

Fed rates - Bullish
The probabilities for end of July Fed rates are 61.0% of 200-225bps and 39.0% of 175-200bps. This seems ludicrous to me so I am going to hold out a bit longer before upgrading anything. Does the market know something I don't or are these probabilities an overreaction?



US10Y - Bullish
Yields on the 10 year treasury are up a bit at 2.04%, still bullish.

07.18.19 sentiment: Bullish

Quite and interesting day today I have to say. My bullish senses are strong but I think it will take a lot for any sort of upgrade. One thing is certain though.. gold up is sticking around for awhile so I'll keep on riding. All signs still point and the 1438 level I mentioned yesterday broke pretty well today, now just wait for the run.

Trend durability - Bullish
Gold pushed past recent highs today and as I write this we are at a critical point where the Fed has made a comment to push gold down. If gold bounces back I will feel very good about the durability of this trend.

Global Stability - Bullish
We got drones blowing up in Iran today.. nuff said.

GLD put call/ratio - Bullish
The ratio is currently at 0.573 still bullish.

Fed rate expectations - Very Bullish
The probabilities for end of July Fed rates are 40.3% of 200-225bps and 59.7% of 175-200bps. The crazy has gotten crazier. As I said above there is significant news coming out now so this will certainly be different tomorrow, hold on tight.

US10Y - Bullish
Yields on the 10 year treasury are up a bit at 2.03%, still bullish.

07.24.19 sentiment: Bullish

I skipped a few days here so I had to make sure my sentiment was still in line, if the GLD put/call ratio wasn't so low today I probably would have downgraded my sentiment to 'Slightly Bullish'. I also think I may add an S&P 500 indicator since the correlations with gold can bring some insight. I'm not sold on the idea because I don't want to add too many indicators but a few more wouldn't hurt if they are the right ones and taken in context.

Trend durability - Slightly Bullish
Gold recovered well from news about US/China negotiations yesterday but also closed the gap up that resulted from weekend news. The end of last week also saw a wet blanket thrown on the gold trend when the Fed made comments steering markets away from expectations of a 50bps rate cut. The trend is getting a bit lost in all the news again and price is hovering back around the 15 day SMA.

Global Stability - Slightly Bullish
The US reported strong service sector growth and consumer sentiment and has been in negotiation talks with China since Monday. US Fed officials also signaled a smaller rate cut than what the market was pricing in. The only new instability introduced into the markets has come from Iran. The provocation with the UK in the Persian Gulf and with the US in the Strait of Hormuz could turn into something pretty ugly. The timeline on Iran conflicts is obviously uncertain but my guess is that they will not escalate high enough in the immediate future.

GLD put call/ratio - Very Bullish
The ratio is currently at 0.504 which is the lowest I have recorded it at. The trend in the ratio has turned downward and after holding back based on a drift up this reading gives me confidence in the upgrade.

Fed rate expectations - Bullish
The probabilities for end of July Fed rates are 76.5% of 200-225bps and 23.5% of 175-200bps. The craziness subsided at the end of last week when the Fed brought expectations in line. Since then it looks like markets are continuing to drift toward a 50bps rate cut again though as the reading was 79%/21% yesterday. We will have to see how things play out but I would be cautious if sentiment edges back toward anything less than 70% for the 25bps cut. If that happens I will certainly close some positions by July 30th.



US10Y - Bullish
Yields on the 10 year treasury are hanging in the same zone right now. Today we sit at 2.05%.

Interesting......