The gold price hits my targets in the charts

Ignore all the talk about a surge in demand for gold coming from Russia and China, says John C Burford. Let the charts be your guide.

There is much talk about the current and future surge in demand for physical gold from Russia and China in particular. The obvious conclusion is that the price should rise in the absence of a corresponding surge in supply. Many gold pundits offer copious data backing up their bullish views.

But here's the thing: I have found over the years that there is little or no link between the supply and demand data and the gold price.

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(Contracts of 100 troy ounces)Row 0 - Cell 1 Row 0 - Cell 2 Row 0 - Cell 3 Open interest: 378,689
Commitments
159,56798,44026,148156,553219,703342,268344,29136,42134,398
Changes from 06/03/14 (Change in open interest: -3,452)
2,235259-2,258-2,992-3,286-3,015-5,285-4371,833
Percent of open in terest for each category of traders
42.126.06.941.358.090.490.99.69.1
Number of traders in each category (Total traders: 260)
11180665149190170Row 8 - Cell 7 Row 8 - Cell 8

John is is a British-born lapsed PhD physicist, who previously worked for Nasa on the Mars exploration team. He is a former commodity trading advisor with the US Commodities Futures Trading Commission, and worked in a boutique futures house in California in the 1980s.

 

He was a partner in one of the first futures newsletter advisory services, based in Washington DC, specialising in pork bellies and currencies. John is primarily a chart-reading trader, having cut his trading teeth in the days before PCs.

 

As well as his work in the financial world, he has launched, run and sold several 'real' businesses producing 'real' products.