Gold GOLD PRO WEEKLY, March 23 - 27, 2020

Sive Morten

Special Consultant to the FPA
Messages
13,383
Greetings everybody,

Gold gradually returns status quo as it has to cost much higher especially on a background of unlimited cash printing. Despite that gold still stands in a limits of "retracement" - recent price action strongly hints that this is probably not a retracement.
On daily chart we see too strong action for bearish reversal H&S pattern, especially for the right arm, where bears should take control over the market. Now price has broken through major 5/8 Fib level and climb deeply overbought:
gold_d_25_03_20.png


On 4H chart we could make a discount and accept this action while gold stands at ultimate point of retracement - XOP target. But - watch closely. As soon as price moves above it - we're in trend continuation, not in retracement any more.
gold_4h_25_03_20.png


Despite solid price action -we do not see any good setups by far. It is too early to go short as we do not have any clear bearish patterns. It is not time yet for the new long positions as well - market is too overextended in short-term. We need to wait a bit when rush will calm down and then search chances on a pullback...
 

minimax

1st Lieutenant
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minimax

1st Lieutenant
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Sive Morten

Special Consultant to the FPA
Messages
13,383
Greetings everybody,

At first glance nothing happens on gold as it is still coiling around 1610 level on daily. But it is not quite so. As we've said yesterday - it would be better to not consider any short positions as chances on two leg downside action melts fast and explosive rally looks irrational on a background of H&S pattern. It means that gold prepares to upside continuation.
gold_d_26_03_20.png


On 4H chart price shows pennant consolidation right around XOP target, which means energy building for upside breakout. And, if we wouldn't have overbought on daily I would call for taking long position here. But this is not all yet...
gold_4h_26_03_20.png


1H chart shows signs of bullish dynamic pressure, suggesting upside breakout. But what is more interesting - take a look at long tails on the candles. It seems that every minor sell-off is buying back by strong demand for gold. We haven't seen this for a long time, if we ever have seen this. It looks like artificial price holding at fix levels by providing big sells. Sounds crazy, but price action looks the same as it sounds. This is CFD, and retail broker guys. It is interesting what we have on COMEX. They probably try to last it till the weekend to calm down a bit. But next week upside action probably will continue.

Here we need to keep an eye on minor retracement - even to 1560-1580 area is good, I suppose. That's being said - no shorts, keep an eye on minor pullback to smooth daily overbought a bit.
gold_1h_26_03_20.png
 
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