Gold’s weekly outlook: March 26-30

Gold rose more than $30 in the past week after bouncing off its support area at $1308. Such a move was on expected lines if the support was held and the size of the move was due to the low volatility seen in the previous weeks which was showing signs of accumulation and it sort of mirrored a catapult kind of move as the prices were held back and consolidating within a range then fired up breaking through the range. Gold had a good closing after a month as it managed to conquer $1345 on closing basis which is a bullish sign.

On the chart –

Gold had a big green week aided by a falling dollar index and key support levels being respected. Fundamentally the Fed outcome also helped the yellow metal as it turned the falling dollar index even weaker. We have 2 scenarios –

1. Gold’s closing above the $1345 mark suggests expansion in the range which it was caught in from last 3 weeks. If this is held then gold can move towards the resistance area of $1362. If this is taken out it can rise to fresh 52 week highs of $1374.

2. There are no short trades unless $1345 breaks and overall trend reverses, if it happens still it is limited to $1331.

Bullish view – Bulls were on a tear after 4 weeks of calmness as the supports were held which pressured the prices on the higher side. The low dollar index also favored the bulls who were able to break the range on the upside by having a good closing for the week suggesting a fresh 52 week high is on the offing. It was another big green bar which got created after a month nearly mirroring the amount of gains of the previous upmove. If this momentum is continued and if the fundamentals keep on supporting then gold can rise towards $1400 sooner than expected.

There is no bearish views as the range got broken on the upside which is favoring uptrend.

On larger terms, Gold has turned bullish as the range got broken on the upside suggesting more uptrend ahead.

Possible trades are on both sides but largely on long side, gold can be bought above $1350 for the targets of $1362 and $1374 with a stop loss placed below $1342.
Short trades are not the flavor but comes into the picture once $1345 breaks but still its limited to $1331.

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Gold’s weekly outlook: March 19-23

Gold had a fall of over $10 in a yet another range bound week. Price action has seemingly lost volatility and is confined within a strict 40$-45$ range. Last week gold found resistance at $1331 before retreating and falling to lows of $1309 where it found support of the 20 day moving average and bounced off. Technically the closing price is under the support of $1317 which suggests signs of bearishness which may lead it to test $1300 again. But if the 20 day moving average is respected then upmove cannot be ruled out but again it will be contained in the range.

On the chart –

Gold’s straight 3rd week of increasingly low volatility and sideways action offered little to the bulls and bears but it continued to register lower highs for 5th consecutive week. Resistances were respected so were the supports so it continues to be confusing but this week’s cut and closing suggests bias is more on the downside. We have 2 scenarios – 

1. Gold’s holding onto the support of 20 day moving average and a bounce from there suggests buying still may be present at lower levels. If the supports are held and if gold manages to cross $1317 it can go higher till $1331. If this resistance is crossed it can move towards $1345.

2. Gold had a poor closing which suggests it might retest the support at $1308 again. If this is breached then it can fall towards $1297.

Bullish view – Bulls are waning out on week to week basis and this is not good for the price action to move ahead with force. Only consolation bulls can take home is they were able to protect the downside via the support of 20 day moving average which was respected and prices bounced from there. For bulls holding of $1300 is the most important to keep themselves in the fray, till it is held they have can have a fight back to push the prices higher.

Bearish view – Bears are clear winners as one by one supports are getting broken on weekly basis. Bears were able to defend the $1331 mark and added to the downside pressure by pushing the prices towards 20 day moving average but failed to breach that, still they won the week as they managed to get the closing under the support of $1317. To keep the momentum on the downside they must defend $1317 and try to erode the support area of $1308.

On larger terms, Gold remains sideways with a bearish bias as the closing was not upto the mark and may lead to more downside. But on a broader picture gold is still confined in a range and it must break on either side for a decisive trend.

Possible trades are on both sides, gold can be bought above $1320 for the targets of $1331 and $1345 with a stop loss placed below $1317.
Short trades comes into the picture once $1308 breaks for the target of $1297 with a stop loss placed above $1314.

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Gold’s weekly outlook: March 12-16

Gold had a rangebound week ending with a cut of only $1. Price action was contained in a range which was the support and the resistance behaving on expected lines. Volatility was there but it was also confined within the range as key fundamental changes pushed the prices lower from the highs primary factor being geopolitical tensions getting tempered down as U.S and North Korea agreed to have talks. But the confusion still prevails as neither of the support or resistance got breached on closing basis.

On the chart –

Gold’s sideways movement which tested both the support and resistance still doesn’t offer any clarity to either bulls or bears even though they had their piece of pie in the week’s volatility. News flow is all the more causing confusion since bond yields are on the critical juncture which can aggressively push the metal in one direction. In the given situation we have 2 scenarios –

1. Gold held the support of $1317 and bounced back twice in the week, if this support holds then we can see uptrend resuming and once gold is able to move higher above $1331 it can rally till $1345. If this is crossed it can go higher till $1362. If this resistance area is conquered it can climb till $1374.

2. Again short trades are not the flavor but if $1331 is rejected it can fall towards $1317. If this support fails to hold it can fall back to $1308.

Bullish view – Bulls are in for a tough fight as they need to hold the supports which they were successful in the past week which allowed a move higher but couldn’t manage to cross the resistance at $1340s which led to a downfall yet again. For them to remain in the game they need to hold the support and to take charge they need to break the resistance at $1340s which will enable them to take the prices to fresh 52 week highs. Technically a bullish flag is in formation in daily time frame which could aid the bulls to keep the prices afloat above $1300.

Bearish view – Bears had a see-saw kind of week but ultimately they won even though it was through a cut of just $1. They had the upper hand in the week on account of erosion of prices lower from the support at $1317 but they failed to capitalize. In order to get the tide to turn red they need to break through $1317 decisively.

On larger terms, Gold continues to remain sideways as no clear direction is visible since the price is cradled between the support and the resistance. Need a break on either side for a clear direction.

Possible trades are on both sides but largely on long side, gold can be bought above $1337 for the targets of $1345 and $1362 with a stop loss placed below $1331. Longer term target $1374.
There are no short trades unless $1317 breaks, and if it does still its limited to $1308.

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Gold’s weekly outlook: Mar 05-09

Gold had a roller coaster ride in the past week touching both support and resistance when it whipsawed nearly $40 but managed to close with a minor cut of $7. The 20 day moving average was once again respected in weekly timeframe and it gave the metal the boost it required to rebound from the lows of $1300s. Such a move from lows again was purely on technical grounds and a possible triple bottom has been formed suggesting the $1300 mark wont be easy to break.

On the chart –

Gold’s behavior was very confusing as both bulls and bears had their share but none managed to make a clear impact thus making way for more sideways and range-bound trade. There is a lot going on fundamentally which can impact gold on either direction as the news flow from U.S is quite influencing. We have 2 scenarios –

1. Gold had a bitter crash from the highs but managed to latch on to the 20 day moving average and rebounded from there. If the movement on upside remains strong and if its able to take out $1331 it can head towards $1345. If this is crossed it can rally to $1362. And if this mark is conquered it can rise towards $1374.

2. Short trades are not the flavor but if $1331 is rejected it can fall towards $1317. If this support fails to hold it can fall back to $1308 which is looking very less likely given the past week moves.

Bullish view – Bulls were rocked hard this time as the prices dropped from the highs of $1340 to $1300 without any retracement, but they fought back hard once the support of 20 day moving average paused the selling pressure and it reversed from there closing above the resistance at $1317 for the week. This happened for the third time when the bulls were able to defend $1300 thus keeping gold safely into their grip. If bulls manage to cross $1331 then they can make the situation to favor them and the upside momentum can resume.

Bearish view – Bears pummeled the bulls as they eroded nearly $40 without any respite but failed to keep up the pressure at the closing for the week suggesting they may be tired after such a big move. But if they manage to defend $1317 then ball would be in their court and the prices may see a drop but contained within $1300.

On larger terms, Gold remains sideways as no clear direction is visible since the price is cradled between the support and the resistance. Need a break on either side for a clear direction.

Possible trades are on both sides but largely on long side, gold can be bought above $1337 for the targets of $1345 and $1362 with a stop loss placed below $1331. Longer term target $1374.
There are no short trades unless $1317 breaks, and if it does still its limited to $1308.

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