Hi Everyone,

In what was probably the most high stakes bet in modern times, Theresa May has shown us what happens when you gamble with the world.

A hung parliament is the worst possible outcome too. The UK has officially triggered Article 50 in March. They have exactly until March of 2019 to make brexit happen.

At this point, they should be prepping negotiations with the EU. The last two months were a monumental waste of time and now it seems that the next two months will be as well.

The Pound is falling, the clock is ticking, May is over, summer is just beginning.

Senior Market Analyst @eToro

Today’s Highlights

  • Manipulation of Gold
  • …digital and physical
  • Please note: All data, figures & graphs are valid as of June 9th. All trading carries risk. Only risk capital you’re prepared to lose.

Market Manipulation

Just moments before the testimony of fired FBI Director James Comey somebody made a rather transparent attempt to manipulate the price of gold.

Usually, if you want to sell a lot of a specific commodity, especially when the trend is going up, a savvy trader will place many different orders at different prices. That way, as the price moves higher you keep getting a better price on every trade.

Yesterday afternoon, somebody placed a single order to sell $4 Billion worth of gold at the current market rate. The order was placed just before Comey’s testimony at a time when the markets were very quiet and liquidity was low, giving it the maximum possible impact on the price.

The reason for this manipulation is quite clear as well. Since the beginning of the year, the precious metal was picking up momentum and has created itself a nice channel towards the sky…

On Tuesday, the price failed to break above the critical $1300 level and pulled back a bit on Wednesday. By putting in that large order, our culprit must have sought to send the price back towards the bottom of the channel rather than let it gather enough steam to cross $1300.

Digital Gold

Meanwhile, gold’s counterpart in the cloud has created some interesting patterns on the chart as well. Bitcoin has made a remarkable recovery since the massive pullback two weeks ago (yellow circle) and since has seen a new all time high of $2927 a coin.

Now, the fact that it recovered so quickly is a good sign. However, in the past, every time bitcoin makes a new high it is immediately followed by a surge. Here we can see that the new high was followed by a pullback.

As well, volumes from Asia have been muted over the past 24 hours and a lot of the trading is happening on speculative exchanges.

Certainly, we know that Bitcoin is becoming more and more useful in Japan and is now accepted in many supermarkets there. However, Mrs. Watanabe, the Japanese trading housewife is very savvy indeed. If she feels she’ll be able to buy in at a better price next week, she’ll likely have the patience to wait.

However, if we do start seeing new highs again, it could lead to another panic surge as analysts continue calling fo $10,000 a coin and higher.

Have a marvelous weekend ahead!

Best regards,
Mati Greenspan
Senior Market Analyst

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