Explanation of tepid cxb performanceSince I have now figured out the algos on gold and the trading on CXB I had the following question:
Why is CXB much lower today, it should be at .98 , than when gold was lower just a few weeks ago?
Why? to begin with there ar no algos on CXB and the day traders look more for shorting on gold stocks than winners. It will go back up a lot as the movement towards gold stocks reach the small ones as opposed to the bigger names.
Also gold cannot go up again tomorrow after today's solid gain. Asia wants slow steps upwards and too much excitement for gold is counter to the policy of going up unnoticed. Asians love the humble low key no name approach, they do this buying land and companies in North america - looowwww keeyyy. They are less shy about Afica since they want the positive propaganda to spread, which is impossible in north america.
This is why we are always hitting a glass ceiling, with gold down $5 each of 3 days followed by a $30 gain in day four. Sometimes when the physical buying is exuberant those who fix the price in the morning have to suffer the physical demand during the day which is what happened today. Look at silver which jumped 5-6% because the price fixers did not expect great physical demand for silver.
Tomorrow will be down again and the shorts on gold stocks will be back but fewer.
Watch gold escalate big time in the coming months. 2 small steps down and a huge step up , time after time. this explains the CXB performance.