Gold’s weekly outlook: Oct 16-20

Gold made a comeback rising nearly $30 in the week on account of poor data yet again coming from America. Such a move was on anticipated lines as gold had made a bottom in the previous week. With a close above $1300 it strengthens the bullish picture for the prices. Gold crossed a key resistance at $1297 in one go which signals more up-move ahead.

On the chart –

Gold climbed back above the crucial $1300 mark on the backing of good fundamentals which supported the rise in the price. Though such a move was technically expected to happen and the fundamentals just confirmed it. Gold is in good bullish grip and the prices are expected to keep the rising trend intact. We have 2 scenarios –

1. Gold’s re-entry into $1300 suggests more activity for the bulls and if this trend continues which is extremely likely, gold can head higher to $1307. If this price point is taken out it can further rise to $1317 which is a resistance area. If this area is crossed gold can climb to $1334 which had earlier acted as a good support/resistance.

2. There are no short trades as gold has made a breakout again above $1300. Such positional trades can become active only if $1281 is broken.

Bullish view – Bulls were back in action after 4 weeks of slumber. They reconquered the crucial $1300 which clearly suggests more upside and maybe the metal can make a fresh 52 week high. Such big moves which takes out multiple resistances/supports are trend makers and in this case it is a strong bullish wave surging from the lows the metal had made. With the prices now in bullish trend, gold is expected to head higher and maybe create a new 52 week high in coming days/weeks.

There is no bearish perspective unless the trend is reversed.

On larger terms, Gold remains bullish and the prices are expected to head higher.

Possible trades are on both sides but largely on long side, Gold can be bought above $1305 for the targets of $1307 and $1317 with a stop loss placed below $1294. Longer term target $1334.
There is no positional short trade available.

gold weekly 29

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