➡ Vince Lancy’s Morning Markets and Metals report suggests that smart, disciplined investors are moving away from gold, while short-term gamblers are moving in. This could lead to a price increase if market interest rises. The report also discusses Trump’s UK trade deal and its potential impact on the gold market. Lastly, it provides a detailed analysis of various market indicators and their implications.
➡ The article discusses the complex dynamics of the gold market, highlighting the roles of different players such as big smart money, smaller speculative money, and macro discretionary funds. It explains how these players react to market changes and how their actions influence the market’s direction. The article also emphasizes the importance of open interest in predicting market trends, suggesting that when open interest bottoms, it’s a good time to buy. However, the market is currently volatile, making it risky for long-term investments without definitive news.
➡ The recent announcement of a US-UK deal by Donald Trump has caused the markets to pause and reassess. Stocks have reacted positively, while gold has reacted negatively. Market players are cautiously waiting for the next news, with some withdrawing and others entering the market. The current stance on gold is neutral, with the expectation of a potential increase if market interest rises.

With regards to gold itself, we call it violently neutral and believe that smart and disciplined money is getting out and short term gambling money is getting in. We believe that historically speaking this augurs for a higher move if the market open interest starts to uptick. Welcome to the Morning Markets and Metals with Vince Lancy where each morning Vince brings you the financial and precious metals news to get you ready for your day. And now here’s Vince. Good morning everyone. It’s Friday, 8:05am I’m Vince Lancy and this is the Gold Fix market rundown. Today we’re going to try and get to the bottom of the gold market right now.

It has been violent, it has been neutral, it is violently neutral. We’re also going to discuss Trump’s UK trade deal as analyzed by Goldman Sachs. So Tom, let’s get to the markets. 10 year yields are 439 up 1. The dollar is 100 spot 39 down 24. The SPX is 56.84 up 19. The VIX is 22 spot 14 down 33 basis points. Gold is 3331 up 25 and change. Okay. Silver is 32.55 up 15 and change. Copper is 453, unchanged offer WTI 6129 bid up 80. Natural gas is 358 bid up 4. Bitcoin 103, 034 down 200.

That’s been on a torrid run lease recently. Palladium is 981 up 10 and change. Platform platinum 986 and change up 3. Gold, silver 102 spot 30. Soybeans 1038 up 5. Corn 445 up 4 and a half. Wheat 534 spot 10 up 2 and a half. Okay, there’s your homepage, Top left hand side. City miners top center. That’s an academic piece that we put together, essentially a culmination or a pit stop I guess in the things that’s going on in the marketplace. The culmination of identifying the Russia China gold for oil deal and what it has led to very recently in combination with the history of bullion banks and how they hedge and Steven Moran’s Mar A Lago deal.

It is a plan proposal. It’s a paper on what we think is probably starting to happen now, if not soon and that is US Government hedging gold exposure after they get done buying it. Lower left hand side Goldman Trump announces UK Trade deal signals China optimism. Let’s get right with the first part. Trump’s UK trade deal. The announced US UK deal yesterday leaves 10% baseline tariff intact for most partners, but shows flexibility on sector tariff, sector specific tariffs. Trump’s comments suggest possible easing with China, but renewed risk of targeted tariff hikes elsewhere. Goldman says that Trump announces the UK trade deal signals China optimism and there’s risk elsewhere essentially.

Well, let’s keep reading and then I’ll tell you what I think probably the most important part of it is the tone shifts on China. Retaliatory tariff removal expected. Trump adopted a more conciliatory stance on US China talks. Quoted as saying, quote, it doesn’t matter who made the first call. He emphasized China’s willingness to make a deal. He projected progress over the coming weekend. Goldman Sachs continues to expect removal of reciprocal tariffs soon with remaining hikes of 54 basis percentage points US and 34 percentage points China still in place. Okay, the first part is this just to get the meta part out of the way.

Like I like to obsess about Trump’s doing the carrot stick approach. If he’s going carrot with someone, he’s going stick with someone else. And so he’s changing. He’s good, he’s a one man, good cop, bad cop situation, right? So burn Canada, burn Mexico, love Russia. That’s when this started. Right now it’s love Canada, you know, love Mexico or maybe not love, but working towards it and then cut a deal with someone who’s willing to cut a deal, first mover advantage, so to speak. And UK is probably the weaker sister out of the trade partners post Brexit and other reasons.

So a deal’s cut with the UK and now he’s going to be good cop with them and pivot towards China in a conciliatory fashion out of strength and pivot towards Russia slightly negatively now. So that’s the meta take, right? So we get that out of the way. The Trump take, right? The Trump bio, the Trump biography tape, specifically on the tariffs themselves. You may notice he started with, he kind of went back and forth in the beginning. He started with global tariffs, right? And that’s where we are now. We’re at the universal tariff is the term that they use.

And so I think he’s found his, his zone in that area. Meaning he and Besson have come up with a plan is you tax everyone, right? And then you pull them off based on negotiations. So basically you make them all feel the pressure and then you let them come to you or you go to them one at a time and then you take universal tariff off and you negotiate certain industries or you leave the universal tariff on and you take off certain industries. So in India’s case, there’s a breakthrough on cars, there’s a breakthrough on this, there’s a breakthrough on that.

In the UK’s case, it’s a different situation altogether. But there’s concessions going along with these as well. So and you probably won’t, you have to redefine print on these and we have not done that yet. Anyway. So now it’s kind of like this weekend could be big news for China. In the back of my mind, I’m concerned, not concerned. I’m aware of the fact that China is Trump can be like Beethoven. There’s a movie scene with Gary Oldman where he says Beethoven starts out strong and then he kind of loses it. So the shock and all concept, the press was just inundated with deal this, deal that, deal this, deal that.

And again, you cannot afford to think he’s full of shit, okay? When he gets close to the finish line with someone, he’ll do that. And if somebody pulls back, he has to redirect the press and that’s what he does frequently in this situation. No, I, I think the weekend could be, could be eventful. So let’s see. And gold is up and you’re saying, well if the weekend’s eventful, why is gold up? Because everyone’s been selling the last two days because of the UK deal and now today people are saying, oh let me cover some shorts. You never know what the hell’s going to happen.

That’s why we’re up today. Aside from the fact that the dollar is weaker. Okay, so moving on before we’re going to do the gold violently neutral thing at the end today because it’s going to be part of a technical analysis commentary and it’s kind of a preview of what we do on Sundays in our Sunday discussions. So next market recap. Wall street ended higher as investors cheered the US UK trade deal and President Trump’s remarks hinting at more consequential talks with China. Treasury yields were up. Gold extended losses while the dollar firmed. Oil prices rose on demand optimism.

Canada’s main stock index edged higher as investors also cheered corporate earnings as well as limited bilateral trade deal between the US and UK that could signal an easing of tariff related uncertainty today. A lot of Fed speakers, nothing. Powell’s not speaking today. So I think today’s keep the camera on the Fed type of thing next. Related Posts Goldman, Trump announces We’re going to talk about, we talked about that Gold Reconsider. We talked about that. City miners, you know, about that Gulf experience. India, Pakistan’s history, conflict. That’s a nice story unlocked, essentially. It gives you a nice list of 10 things to keep in mind.

And the reason that we titled it India Pakistan’s History of Conflict because there are changes. So for example, the UK used to factor very big entities, but not so much now. So there’s, It’s a nice little piece. I forget who wrote it, but I will do that. Let’s get to trying to figure out what the hell is going on in gold. We start with the gold futures chart. And this is a line that we drew when we were talking about the market having been close to breaking this ridiculously steep trend line. Tom. And it looks like, you know, we’re on the cusp of that and it’s trying to make up its mind.

At the bottom you see volumes and we’re looking at volumes a little more closely now. When open interest is this low in gold and it’s that volatile in the market, you want to start watching volumes. And that’s, and that’s what we’re doing in our style again, we’re trying to figure out what the hell is going on here. We know what’s going on. The question is we’re trying to get a, a bias towards which way the market’s going and we have none right now. So let’s, Right now what you’re seeing is a market that since the markets market’s lower and then higher trade in there with the market having a range like this with the open interest doing this.

Okay, so I have bullets here. I’m going to say them in different orders after I give you the main point. The main point is big money. Smart money is getting out while short term gambling is getting in. That’s what this reflects. Okay. There are two types of big money smart money. The big smart money getting out, taking profits is selling the rally. That’s your probably, probably your long bullion bank swap desks and your macro discretionary funds that have been long since, you know, since the cows were born. The other smart money is the macro discretionary quant guys that are selling it because they see the statistical reason for the market to retrace and then it goes down and then it goes back up and they’re stopping themselves out.

So they’re also big, but they’re smart because they’re covering their risk. The smaller money or the more speculative money are number one Shanghai specs who buy on the China open. Now it’s not to. They’re speculative. They’re as powerful as any American hedge fund. Maybe not as big as macro discretionary, but they’re pretty powerful. They’ve eclipsed American CTAs as being important. The other smaller players are American CTAs who will sell on weakness. Not a lot, but they’ll sell a weakness and then they’ll stop themselves out. If the market rallies, the other smaller money will be the same.

American CTAs who buy on new highs breaking out of that channel. Okay, so that’s the background, that’s what the players are doing. And we’ll get into the where China’s physical demand is in a second. But the pattern that we’re looking at here is this is what we saw. The market rallied when the open interest continued to come off down to here. Okay? That was bullion, banks covering shorts. Okay? This is the market dropping and the open interest dropping. That’s macro discretionary selling and some actually getting short on the idea that the market is due for a big retracement.

So that’s the micro, right? So let’s zoom out a little bit and let’s pay attention to this. What happens when open interest bottoms in gold? So here’s your, here’s your bull scenario and it’s powerful. When the oak weather, when the open interest bottoms or show signs of bottoming for the period that it chops around on the lows going back to forever, since the beginning of time, the gold market goes sideways to lower. And the reason it does that is because long speculators are not playing. And we know that long speculators are really not playing this market right now.

Okay? The market will typically go sideways until there’s some reason to get long, you know, trade deficit or, or a budget problem or a war. And those rectangles show that at each bottoming, the market goes sideways and lower. And these last three were very significant. Now you can make a case for the higher lows and lower highs and all that stuff. And we’ve done that before too, but we’re not doing that right now because we sense comx may be a little bit broken. Okay, so inevitably going back to forever, not just on these three periods here, what when this happens, when the open interest breaks out higher, you buy it.

Okay, so where does the open interest break out higher? Well, that’s the art of it. You have to figure that out for yourself or use discipline and speculate on it. Now, there are moments where the open interest breaks out higher on a down move and that’s when we get those fish hooks that I talk about. And then the market just reverses and rips. So that’s why I say sideways to lower as the open interest bottoms. Then the open interest takes a decided turn upward and that’s time to get in. So that everything I just said to you argues for a much bigger, higher move to come when they get in.

And you’ve heard me say before, you’ve heard us say before, that ETF buying, if it gets back to where it was during the COVID crisis and the onset of the Ukraine war, then gold will trade 3,600 to 4,200. Now that was when gold was trading 3,000. And the ETF buying has returned somewhat, but gold has rallied almost for, well, it’s rally $400. Okay, so you could say mission accomplished, but I don’t want to say that yet. But I will say if ETF buying gets back to where it was, the 3600 is looking like a lower, lower price now, not saying 4200, but you get my point.

So this is the situation. There is one difference, House. So here’s where the water gets poured on it. If you’re wondering why I’m doing speaking this way, this is a premium conversation, right? There is one difference. Well, there’s actually two differences. One, the difference is the market is extremely volatile up here now. And that suggests, as I said before, smart money getting out, dumb money, for lack of a better word, getting in. And it suggests that the smart money, profitable or not, is waiting for definitive news. And that’s why with these big ranges, the open interest is really going nowhere.

As the market rallies, the macro funds are selling, right, and the FOMO boys are buying. Right? Okay, so open interest is nowhere or as the market drops, right? The macro quant guys are selling and somebody’s buying. And that somebody is probably bullion banks covering shorts. So there’s a big, well balanced, violently neutrally well balanced group of players playing right now. And we would call this, historically it’s Taurus time, meaning it’s probably a really, really good trade market for intraday hourly charts. But you’re crazy to take a long term position until there’s a definitive news item out.

Now if you have an insight that I don’t have, that’s fine, but. So there you have it. That’s the first scenario. The second scenario is, well, this is the volume situation. The volume situation is telling us that this is, this is the bearish situation, right? The volume situation is telling us that the Market is being really capped by someone with big volume and the dips are being bought pretty aggressively, but the chasing up has decreased. So next. Okay, here’s the thing that you might be able to sink your teeth into. Right, so where’s the violent neutral part? On the first, actually the beginning of the second day of this, we said this is either China buying or someone front running China buying.

And it is. And then it got down here and it found the China buying. Now this area here, if you’re looking for a way to look at it, that’s your violently neutral. This is short covering and FOMO buying, including Shanghai. And this right here is where your China physical is. Tom, the good news is the market has not touched down there. The bad news is if peace deal comes out, it’s not bad, it’s risk. China may just pull their bid in lower to here or whoever they’re buying for. Okay, so to give you a little bit more consolidated again, we’re just trying to give you a behavioral understanding that may complement your own technical situation.

So when the market is here, bullion banks and China front running comes in and takes it higher. Okay, that was bullion banks the first time. That’s actually in here. China front running, we’ll call it down here. We sniff in that area and the buyers come out of the woodwork. Now this is the initial line that I drew before, right. This was the channel, remember I said down here, if it holds here, it should go back up here quickly. And wow, that really happened quickly. And then it got above and I said, okay, this is really good, really good.

As long as we don’t break back into here, then we have. I didn’t know what happened here because who the hell is selling here? That’s the mystery. And that’s really kind of, kind of pissing me off. Okay, so the market start, the market is capped. The market is capped here on the outside. China physical buying, a mystery seller. China front running. And you’re buying in here is FOMO Shanghai, China buying. And this is the front running, the big seller. So here’s your big seller in here and here’s probably your bullion bank selling in front of them.

Anyway, long story short, or let’s make a little bit more less convoluted story, violently neutral means trade the range. If you’re a trader, don’t be committed unless you have to be. If you’re going to be committed to an opinion, I think the trade resolution is going to resolve this way or that way. Then, you know, please use options but do your own due diligence on that. As to us, well let’s see, we had a butterfly on that worked out perfectly. Very short term butterfly. We were short call spreads, we were the idiots in this trade. We were short call spreads, converted them into long call spreads, got neutral near the high because we had no idea what’s going on.

And then the market came off. We’re just like, fine, we give up, we’ll just watch. So I think it’s a day traders market. Now the other thing I wanted to show you is see these three lines here? I’m looking at a product called Poly Trends and now we’re ready to start using it. Those three lines are my lines and here’s the overlay. And these are the polylines. Poly put a line up parallel with mine. So let’s say my line is, you know, close but no cigar where their line is closer. No cigar. And this line, he just started a line over there.

Here I’ll hide my, where’s my line hider. There we go. Right, so here we go. That’s line one. That’s my first line and that’s my other line that I have back here. But he drew it a couple days, this came in a couple days ago. And here’s the line I drew last week. So the moral of the story is I think, I think this is usable now for us. Some of the lines it draws the same time I do. Some of the lines draws afterwards. But it may be, it may be a time saver. We’ll be using this more in the founders classes as I, as I figure it out.

And then we’re going to start day trading with it. To summarize, Donald Trump’s US UK deal announcement over the last 48 hours has given all markets a reason to pause and reassess. Stocks have taken it bullishly, gold has taken it bearishly, today’s move notwithstanding. And market players are pulling out of markets as they position themselves or keep some powder dry for the next news item, which could happen as early as this weekend. With regards to gold itself, we call it violently neutral and believe that smart and disciplined money is getting out and short term gambling money is getting in.

We believe that historically speaking this augurs for a higher move if the market open interest starts to uptick. But until that happens and an event is no longer on our radar, we’re violently neutral and have no opinion directionally. I’m Vince, have a great weekend. Well, thanks for watching this morning’s Markets and Metals with Vince Lancy. We sure appreciate you tuning in and starting your day with us here. Hope you enjoyed the show and we’ll see you again next week. Please note that this video is not intended as legal, licensed financial trading advice and is to be used for informational purposes only.

Please contact your financial advisor before making any decisions and thanks for watching. Sam.
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