Thread: Gold trends

Gold markets have been on a roll lately, and Friday was no exception. The market finds itself being bid up in response to a weaker Dollar, and as the Fed has decided that the low interest rates should continue until at least the end of 2014, it looks as if the Dollar could very well enter a new phase of weakness now.

This is always good for the gold market, and as a result you see sustained buying. The recent breaking above the downtrend line is also a strong indication, and as a result – we are buying pullbacks in this market as it looks likely to continue much, much higher at this point. Selling isn’t even a thought at the moment. $1,700 should be the first line of support from which we could see renewed buying.

Scenario for today

Elliott: support in an extended wave up 1721.45
If market stays below 1736.99 a fall to 1717.42 is expected.
If market breaks the point 1741.21 it could reach the sky.

Supports / Resistances

Res 2 1,752.5700
Ex-High 1,740.1200
Res 1 1,741.2100
Pivot 1,728.7700
Sup 1 1,717.4200
Ex-Low 1,716.3300
Sup 2 1,704.9800

Gold is trading at 1735.20. In a surprising day of trading, as the USD picked up momentum as investors moved to the safety of the greenback the euro collapsed against all its trading partners. Gold seemed to follow suit in early trading, but has maintained most of the remaining in a tight range. It seems the jittery nerves and worries of investors have found that gold is a safe bet at the moment. All of this has been brought on by a weekend of promises from Greek and EU leaders along with the negotiators from the IIF all making statements that a deal had been reached. By mid day Monday, there was no deal on the table and the EU Summit convened with out a deal.
Portugal’s borrowing rate soared to record levels today, compounding the worries in Europe.
Gold will probably continue to rise over the next week while investors try to figure out just what is happening. Gold will probably bounce between support and resistance over the next few days. Futures were likely to find support at USD1,714.45 and resistance at USD1,760.35, the high from December 8.

Gold is still in a strong momentum up, expect a rise to challenge the 1760 position, do note that gold has risen 15% in just one month, the rise is legitimate due to the Fed’s admission to consideration for long term low interest rates and money printing, but if gold cannot break the 1760 level, expect a drop down to the 1700 level easily.

Gold1stFeb.jpg

Mid Week Wednesday gave us the weekly high. There's usually a pullback into Thursday and US Jobs and Payroll reports. Lately, market seems to rally eary in Asia, and then start a sideways to lower grind into London. Bottoms usually occur between 2 to 4 hours into the London session and begin to move back up in a choppy fashion into the reports. Over the last 6 months, they have become less and less a factor. Nevertheless, odds favor a choppy, pullback bias into Thursday. 1725-1733 is the current FIRST Support. But this market can still trade down to 1699-1708 on a WEEKLY test of support. A move to that area would be a spot to consider entering or adding a long position for a trade. Stops at 1688 or somewhere near there. target back up towards 1750.
One thing to watch out for. The market has been very strong and it can keep moving higher here as the trend is up. I may decide to exit near 1750-1755. It just missed 1755 today. I WILL MOST LIKELY POST NEW STOPS between 11am and Midnight if the market warrants it.
If you took profits at 1745-1755, Thursday has the best bet to have a pullback this week after a mid-week wednesday peak. The best time for it to start would be near the latter portion of the Asian trade and into London. For the Nimble, if your looking to sell before the, 1750-1755 spot is still the place to look at first with a tight stop at 1761-1762. With this type of strength however, it's not recommended, or be careful. We are better off trying to catch a pullback into the Jobs data on Thursday morning, or NFP on Friday. But, If there's a pullback to happen this week, it should begin near the London open and into the jobs reports -- target 1729-1735 as potential lows. If we get a weekly pullback to 1699-1708 area.
Consider 1/2 profits at 1750-1755 if you have more than one contract and breakeven on remainder if your long.
1767 is the DECEMBER high, the boyz will br trying to stop it from trading above there. So its a pivot point a few bucks above and below. If they clear 1775---1804 and the November high would be next target to pursue and it would most likely happen pretty quick.
MARKET CONDITION -TREND UP BUT AT RESISTANCE 1755 - 1767 area -- pullbacks and choppy, sideways trading is usually what to expect into a job's report

Price might remain sideways until Thursday morning when the Job data comes out at 8:30 am In New York. Everything in equity land has been spun positive recently, that if the data is spun in the morning, gold could move higher even in the context of how overbought price is. If you nimble, you can try exiting in this 1750 area and re-entering on a move above 1775 but be careful. We might stay in this wedge until the report. Once it moves, I suspect it will be a long range day. Something should give in the next 24 hours. Everything looks like a peak here, but Until price breaks -- we have to favor higher. WATCH 1755 ---- AND 1767. If I exit early.

2G8H.jpg

The Trend remains up, but gold is at weekly resistance 1755-1775. Gold usually stays within a range before the NFP reports on Friday morning. Usually we see an Asian peak, and then a lower London for the first 2 to 3 ½ hours of the session. Of course, this is just a guide of the favored course when nothing else happens during the night. In any event, the best description is gold is usually cautious before the numbers. The usual script is a sideways to lower chop up until a few hours before the report. If there is a spike down, it usually completes between 10 am -11 am New York time (EST). Friday’s used to be strong affairs and if this is a new bull run, the upside has the favor. (there's commentary below this chart)
The Jobs report Friday morning will give the ‘control boys’ an opportunity to spike it and shake off the weak hands or those with tight stops. That grey line with support written under it crosses at the 1735-1745 area. Thus any move below the 1729 area would probably have a lot of traders looking for the exit. And when everyone decides to take profit from this 250 dollar run, it should allow for pullback to at least the 1699-1718 area as a minimum. If you’re a trader and you have good profits, you might want to consider bringing your stops up and getting ready. It’s a fine line as to when to get out because the market has been SO STRONG that any exit for short term traders has to have a re-entry point. In summary, the trend is up, price is at 1755 resistance, and cycles are due to peak. As long as price is touching the panic line (from the earlier chart) each day on the bar chart, we have to favor higher and stay with the uptrend. Watch 1755-1767 on the upside Friday, and 1736-1742 on the downside.

Gold prices slipped following a surprisingly strong report on U.S. jobs for January. The headline figure of 243,000 jobs created was far above even the highest trade estimates and about double the average forecast of about 120,000. The rise in new jobs pushed the unemployment rate to 8.3% from 8.5%. Marc Chandler, head of global currency strategy at Brown Brothers Harriman, said this data has two-fold implications.

Prices fell on Friday and were mixed on the week. The most-active April gold contract on the Comex division of the New York Mercantile Exchange settled at $1,740.30 an ounce, up 0.28% on the week.

Gold prices could retreat a bit next week following five weeks of gains, but overall market watchers said any correction by the yellow metal next week should be light and short-lived, as the overall trend for gold remains higher.

Gold to end next week higher concede that gold could pull back temporarily before moving up. “I would look for prices to pull back to roughly $1,715, maybe a little deeper. Only a close under $1,675 hints at a turn in prices to the downside. After the pullback and a couple days of basing, I expect gold to blast off next week over $1,775,” said Ralph Preston, senior market analyst at Heritage West Financial.

After a heavy week of economic data this week, next week’s offerings are lighter, which should have less impact on precious-metals trade. Consumer sentiment is slated for release on Friday, which will give some insight to how people are feeling about the U.S. economy.
The expected drop from 1762 was spot on and i was looking for 1722-25 to come into play. Though quite frankly was not expecting it to be on Friday all on same day... Anyways the day on Friday printed a huge engulfing bearish candle and initially wanted to build longs off around 1722-25 but now I'm of the view that 1699-1701 for Monday or 1703-05 by Tuesday should now be getting printed b4 we can see a bounce back up now.

As for monday expecting 1718-1740 initial range play, with 1738-42 holds for a short momentum testing 1718-19 out...A break under 1718 puts pressure to the 1700 supp..

GOLD Traded in a range of $1,711 to $1,738. We had expected a move lower in gold yesterday and our move to a neutral stance on gold yesterday was well timed as the metal had a rare down day. Within the last few days, we have seen gold prices react negatively to both good news in the form of the US employment data and bad news in the form of the continuing Greek tragedy. When will gold prices behave and act as they have in the past like any good safe haven asset? We believe a number of factors are now playing out which will see gold soon spike towards $2,000 by mid year. For now we maintain our neutral short term stance due to a number of significant risks in the market this week which may have an entirely unpredictable effect on gold. Barring any further bad news out of Europe, look for a tight range in trade today between $1,710 and $1,730. We expect that gold will retest support just below $1,710 today but that this level should hold.

April Gold extended its drop from the Friday highs. This decline is increasing the bearish technical pattern, and we would expect the pattern favors a continue through down support between 1649-1681 if the cycles remain in effect over the next two weeks.
As long as we remain below 1767, the trend is down. On this daily chart, the 1649-1681 area is the area with best price support on a monthly basis. Swing Traders should keep an eye somewhere in this level, especially if it enters into play when cycles become due to turn up near the 21st of February. This 1649-1681 range is also in line with the 34 week moving averages,so its an important Monthly support area.
The current area to watch on Tuesday is the 1703-1717 area. A price bounce should develop from this area and target 1730-1740. We think its too early to favor the drop we just got is the final low on this pullback. We could get a nice bounce, but we think there is more to play out.
Tuesday favors a 1703-1717 low area, and then a bounce to go check out support. If price gets to 1730-1740 first, we should run into resistance there. FOR THE WEEK, the 1755-1763 area is the place to think about a short if your a bear on the market or a trader who's looking lower.
Trader bulls can consider trying the 1703-1717 area with a 10 dollar stop loss---and the best way to play it is to buy 2 contracts---and sell one if we reach 1738-1740 in April gold. Since the trend is favored lower, it should only be done if your a nimble trader and you know when to take profits and move your stops up as your trading against the trend. SO IF YOUR A QUICK TRADER -- that's the area you want to consider a long for a quick bounce up. IF your looking to short on Tuesday, the safest spot is the 1738-1742 area or the 1755-1759 area.

The gold markets rose on Tuesday as traders got wind of a supposed Greek debt deal in the works. At the end of the day however, nothing had been announced – except that the Greek lawmakers had postponed a meeting to discuss the workout. The gold markets rose as the Dollar sold off, and managed to pop above the $1,750 level at one point during the session.

The central banks are also buyers of gold, and this has put a serious bid in the market. Because of this, the dips have all proved to be buying opportunities over the last several years, and the fall we saw on Monday was yet another example. However, the $1,750 level just above is resistance, and we need to see the market close above it on the daily chart to think that we are “free” of the constraints of this present consolidation area.

The $1,750 level has seen many attacks on it, and the most recent visit was back in early December when the market failed and plunged to the post-holiday lows in January. Because of the action back then, this area should continue to offer a fight, but with the last eleven years being so bullish, it is hard to go against the bulls in this market. Because of this, we are “buy only” in this market.

The world is currently watching several central banks cutting rates, printing money, and being dovish in general. With this in mind, the value of gold should rise as the fiat currencies are weakened in value simultaneously. The trend should continue for the long-term, and we are looking for a $1,900 print by the summer time this year.

The candle does look very strong from the Tuesday session, and does suggest that there will be more buying pressure, but until that level gets closed above, it is hard to buy at the moment. Pullbacks would also be welcome – that exact advice worked on Tuesday. The $1,700 level looks to be supportive going forward, and each time we fall at this point in time, we are willing to go long on shorter time frames in small positions to build up a large one over time.