Gold’s weekly outlook: May 29 – June 02

Gold was fairly volatile in a range in the previous week but managed to gain nearly $10. Gold was stuck in a range of $1247 and $1269 as in early part of the week gold tested the bottom of the range whilst tested the high on the later half of the week. Such range bound weeks often indicate loss of direction but this time it was showing bullishness in the prices rather than a confusion over the movement of Gold. Next week might be a favorable one for the bulls as indicated by the patterns on the chart.

On the chart –

Gold was not out of the hands of the bulls for the entire week and gold added to the gains even if it was barely $10. Gold was expected to trade in a range which it complied to. Circles in the chart denote the ranges gold can trade in, and 2 symmetric circles point to the fact that we might see bullishness which will complete the empty symmetric circle. With shapes pointing towards a bullish move we have a scenario for it –

Gold rose higher after testing the bottom of the range on the first day of the week which suggested bullishness in the prices. Gold shrugged off the volatility caused by Fed Meeting Minutes in the past week and rose higher. With this bullish momentum going on, it may rise to $1283 (A) with a brief pressure faced at $1272 levels. If gold is able to take out this price point it is expected to move higher towards it highs of $1298 (B) which will be seen as a resistance area for the gold as generally highs tend to react in the same way. If this resistance area is taken out we may see further upward movement to $1307 (C) where gold might find a bit of trouble as it is near the highs of the circle.

On a side note, a bearish scenario is also there but its unlikely. The view, Gold can move lower towards $1242 (1) if situations make a turn and gold bulls are trapped. If this price area is taken out it can head lower towards $1228 (2) and if this area gives way prices may head southwards to $1213 (3) which is the lowest point of the circle.

Bullish view – Bulls were not out of the game as the range was respected and the prices turned positive after hitting the lows. Bullish bets were active since the range was not broken with bulls defending $1247 mark third time which suggests a triple bottom thus making the prices surge higher due to such pattern formation. This surge may continue and gold is expected to move higher in the coming week. According to patterns gold may make a new high in coming days/weeks.

On larger terms, Gold looks bullish as patterns indicate movement on the upside. Prices are expected to head higher into the the circle moving into next trading range of $1271 – $1308.

Possible trades are mostly on the bullish side, Gold can be bought around $1272 for the targets of $1283 and $1298 with a stop placed below $1263. Longer term target $1307. If we see a fall in the prices it can be bought near $1259-1263 for the above targets with a stop loss placed below $1247.
Short trades are unlikely, though gold can be sold near $1247 for targets of $1242 and $1228 with a stop loss placed above $1258. Longer term target $1213.

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Gold’s weekly outlook: May 22-26

Gold rose nearly $30 in the last week over worries of political uncertainty surrounding U.S president Donald Trump’s election. Gold added incremental gains from start of the week as demand for the metal spurred due to uncertainty clouds. Gold rose from $1226 to a hit a high of $1265 where it found a resistance due to pattern completion of Head and Shoulders before settling at $1255 for the week. Gold steamed ahead breaking resistances as anticipated in the earlier week.

On the chart –

Gold was clearly in a bullish grip adding gains of about $30 in the week. Gold was expected to move higher which it complied to and gained more than predicted due to noise created by U.S over the election of Donald Trump. Circles on the chart depict the ranges in which gold is trading and where it can trade further in coming days/weeks. With North Korea testing another missile in the weekend we have 2 scenarios –

1. Gold had hit a wall at $1265 as it completed Head and Shoulders pattern and reversed from there. This also indicates lack of buying interest at higher levels as news flow was not that strong to keep the upward momentum going. With gold topping out it can have a fall towards its support at $1247 (A) which it tested twice in the previous week. If this support fails we can see a further downside towards $1224 (B) which is a fairly good reversal zone for the metal. If this zone fails to hold gold can slide further towards $1208 (C). In any circumstance, if this price point fails we can see the price falling towards $1198 (D) which is a massive support for the yellow metal but such a move is unlikely with the amount of worries world is facing at the moment.

2. Gold brushed off negativity surrounding its price and rallied nearly $30 which is seen as a positive for the metal. With the current momentum intact gold can move higher towards $1265 (1) where gold found resistance due to pattern completion. If we manage to break it gold is expected to move forward to $1282 (2) which is a fairly good resistance on the chart. If scenarios favor the yellow metal it can rally higher towards $1295 (3).

Bullish view – Bulls were on top of their game as prices steamed ahead breaking short term resistances. Bullish bets were clearly visible due to the price action. Bulls were able to defend $1247 twice which indicates strength the metal has on the upside. If this support holds, gold is expected to go higher towards new highs above $1265. Also fresh tensions in Korean Peninsula can aid the metal on the upside.

Bearish view – Bears were trapped as the prices rose incrementally from the crucial pivot area of $1228. Bears should be happy as the price was not allowed to run away in one direction and higher level attracted fresh shorts. If tensions over the U.S presidential election runs out of steam gold can see a fall towards the lows of $1224 as it is the only driving factor for the gold. Good data from U.S can also dampen the price of gold.

On larger terms, Gold is continuing to be neutral as fresh worries keeps the metal in check on either side not allowing a clear direction. Prices are expected to trade in the range as depicted by the circles in the chart and if any circle breaks it can move to the next circle or the next trading range. On side note current global worries suggest more upside rather than downside until its solved.

Possible trades are on both sides, Gold can be bought around $1247-1252 for targets of $1265 and $1282 with a stop loss placed below $1242. Longer term target $1295. If we do not see a fall gold can be bought above $1265 for the targets as mentioned above.
Similarly gold can be sold near $1244 for targets of $1235 and $1224 with a stop loss placed above $1247. Longer term target $1208 and $1198.

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Gold’s weekly outlook: May 15-19

Gold ended flat with little movement of a % point on either side in the last week which is a normal consolidation after big moves as seen earlier. In the early half of the week gold slid towards $1214 but regained from the lows to a high of $1236 in the later half before settling at $1228 which is as flat as it could get keeping the guessing game going for both bulls and bears. Week was a dull one as most of the negativity was factored into in the previous week and nothing new was powerful enough to create large moves on the upside. Gold prices just swayed from one side to another trapping both bulls and the bears as the end result was a dampening factor since it again closed on the pivot point from where it can make any conclusive direction. Next week may be an even trickier one but if patterns are to be followed gold should make a U shaped recovery towards $1241.

On the chart –

Gold was directionless and thus tested both support and the resistance swaying in a range of $23. Gold was expected to make a move towards downside considering the outcome of French elections but all the negativity got priced in the week before thus capping the downside momentum where fresh buying was clearly visible on the lower levels.
The movement or the range of gold is shown in a circle on the chart which has a high of $1271 and a low of $1196.5 and gold is expected to trade in the same until either of the price point is taken out.
With gold again at the pivot point, we have 2 scenarios –

1. Gold prices saw a resistance at higher levels which can be said as lack of buying interest at higher levels as nothing was backing the demand for the yellow metal. Gold fell back towards its pivot/support point at $1228 (A) which is a very crucial mark. If this price point is taken out we might see a downside towards $1208 (B) which is considered to be a good support/demand area for the gold. If on any grounds this demand area fails to support the prices the metal can slide downwards to $1196 (C) which is a very crucial and a big support, it also is the lowest point of the circle in which gold is expected to move and this point must hold to keep the bulls in the game.

2. Gold retraced the losses to gain momentum to go forwards to its resistance area which is considered as a bullish since buying was clearly visible at lower levels. Also catering to bullishness is the fact the gold closed at the pivot/support of $1228 (1). If prices start to move in positive direction we can see it going towards the $1244 (2) which is a brief resistance on the chart. Now if this level is taken out on conclusive basis we can see the prices moving upwards to $1271 (3) which is the top of the circle and possibly a fair resistance level on the chart.

Bullish view – Bulls are still in the game since the price retraced from the lows and closed higher at the pivot point of $1228 from where a decisive movement can take place. Bulls were able to defend the support as lower levels attracted buying thus arresting the fall which started from the highs of $1297. If this support holds, prices are expected to head higher as most of the negativity is priced in with no major events in the corner which will lead to a selloff in gold.

Bearish view – Bears should be happy as they defended the $1237 mark which may be seen as a bearish sign as shorts were active at those levels. The close at the support also lends some relief to the bears as they can once again try to erode the prices towards lower levels. If tensions around the globe and uncertainties over U.S data subside we might see the prices going to lower levels as there seems to be lack of demand at higher prices.

On larger terms, Gold is clueless over which direction it should pursue as technicals and fundamentals are pushing and pulling the prices. Prices are expected to trade in a range as depicted by a circle in the chart. On a side note Gold is expected to go higher if patterns are to be followed.

Possible trades are on both sides, Gold can be bought around $1235 for the targets of $1244 and $1257 with a stop loss below $1224. Longer term targets $1271 and $1285.
Similarly gold can be sold near $1220 for the targets of $1208 and $1196 with a stop loss above $1230. Longer term target $1164.

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Gold’s weekly outlook: May 08-12

Gold saw a big fall of over $40 last week as the selling pressure was incremental from the start of the week. A massive weekly red bar indicates that gold is not seeing buying at higher levels rather shorts are attracted there combined by lack of news flow regarding uncertainty over the Korean Peninsula which was one of the key reasons for the metal to fall off the cliff. Another reason which aided the fall in gold was lack of direction from the FOMC meeting on Wednesday. The week was a compelling bearish one with the price eroded to an extent that all intermediate supports were taken out including the technical support of double bottom. Gold fell from the highs of $1270 to $1226 before settling just above the support at $1228. Gold is again expected to be very volatile next week due to the outcome of French elections on Sunday the 7th.

On the chart-

Gold broke the trading range as it slipped over $40 as mentioned in the earlier post since it closed way below the $1238 mark. On positive side gold managed to take support just above the channel a-b which if it enters could be more bearish for the price. Next week could be another relentless week for the prices on either side due to the outcome of French elections. Possible 2 scenarios for the week –

1. Gold prices cracked over $40 and even failed the support of the double bottom created at $1260 which is treated as a very bearish sign for the metal. Gold is again trading at a crucial pivot/support at $1228 which if broken can send the prices south towards the $1208 (A) zones which is a fairly good support on the chart. If this price is taken out we might see a further fall towards the big support at $1197 (B) which must hold to keep bulls in the game as it did previously. In any circumstance if this huge support gives way, the price is expected to test $1164 (C) which is also the lower end of the channel but such a move looks unlikely as tension over North Korea hasn’t subsided.

2. Gold took support at $1228 signalling the fall might be arrested which is a very positive sign for the metal. If this support holds we might see the price moving forward to $1235 (1) which is widely seen as a brief resistance in the chart over the months. If bulls are able to take this out with a force we might see the prices advancing towards $1257 (2). With uncertainties still looming in the corners, prices might go higher towards $1285 (3) if $1257 is crossed conclusively.

Bullish view – Bulls should take the $1229 with both hands as they were pinned down throughout the week having no respite at all. Having closed above the support the bulls might be relieved as this signals bullishness for the prices going ahead having arrested the fall back towards $1250-1260 zones. If the support holds, its a very positive sign and prices are expected to retrace back towards the highs of $1280 as tensions over Korean Peninsula hasn’t died down completely.

Bearish view – Bears were on top of their game as they managed to erode the prices over $40 creating a massive red weekly bar with all intermediate supports taken out in one go. Failure to to hold the $1260 mark was considered as a very bearish sign which lead to such a massive fall making the bears rejoice throughout the week. Outcome expected out of French election is very bearish for gold and if it goes as predicted gold would see a massive downtrend resulting in breaking of major supports.

On larger terms, Gold is still neutral due to the uncertainties over French elections. Prices are expected to trade in a very volatile scenario with relentless moves on either sides.

Possible trades are on both sides, Gold can be bought around $1230 for targets of $1244 and $1257 with a stop loss placed below $1218. Longer term target $1285.
Similarly Gold can be sold near $1220 for targets of $1208 and $1197. Longer term target $1164.

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