The euro made an undercut on Monday and as that low was lower than the low printed on last Thursday, the HCL I’ve been expecting was moved from Thursday to Monday. I suspect that the euro is now ready to move higher which should give gold some tailwind. Undercuts like these create liquidity spikes to the market as retail traders place stops below support like these. When lots of stops are triggered, it enables big money to scoop up the underlying at a good price. I think that the undercut yesterday was manufactured in order for a trader with deep pockets to get in position before the next rally. He or she did a good job.
To receive instant notifications on new posts, follow SKAL Capital on Twitter.