Gold scooted past $2000 in another large ranged week as dollar continued its downtrend. Another milestone in matter of 3 weeks simply puts across a stern message regarding the trend and its follow through, this parabolic move does indicate a lot towards FOMO rally but again the precious metals basket got an overall lift when silver mobilized real hard suggesting the move is more of actual than a traditional retailer trap. When stimulus talks hit a bottleneck, a major cause of pullback last week, President Trump signed an executive order in the weekend providing much needed relief which again should set the course back to a lower dollar and higher gold as globally things remain equally murky as it was rather the pandemic still grows which should keep the QE pursuant till 2022. On the brighter side, a possible vaccine might be launched in the coming days by Russia whose authenticity is yet not confirmed fully again causing a flutter of uncertainty. In the current scenario, its the liquidity which is driving up all the asset classes excepting dollar which should continue further until free money flow is stemmed. To watch next week – Earnings and other important economic data.
On the chart –
Gold hurried over $2000 as shorts continued to get punished partly due to immense liquidity and party cause of technical push. Its getting more and more stretched on the upside but still this overbought state is not acting as much of a roadblock for further gains since charts can stay in such a condition if situations persist/demands which is the actual reality at the moment. With more stimulus, this is not looking like stopping anytime soon until an exhaustion limit is reached. Technicals remain favorable as its creating fresh highs and new closing ones as well moreover every week with no reversal pattern in sight. We have 2 scenarios –
1. Gold closed above the support, till this is held it can go to $2061. If this is crossed it can move towards $2090. And if this is taken out it can rally to $2109.
2. Short bets still remain an ill fated option except scalp trades.
Bullish view – Bulls achieved another milestone as they conquered $2000 for the first time on back of a lower dollar and ample liquidity. This straight $230 point rally in span of 3 weeks does showcase the prowess of the bulls as they were unforgiving to any shorting opportunity rather the recurring shorts fueled the upmove. There was a slight hiccup at the end of last week where the metal pulled back quite sharply from highs (maybe due to week ending adjustment) as stimulus talks hit a roadblock, but all seems well now post signing of an executive order in the weekend by President Trump to keep the stimulus going which should put back gold into its ascending course as likely the dollar will get another blow. Other than this, ongoing concerns remain elevated as pandemic continues to rattle the economies while geopolitical tensions fail to ease. With the above considerations its highly likely for gold to reach $2300 and maybe even higher before a major correction sets in.
Bearishness still remains off grid.
On larger terms, Gold remains bullish and prices are expected to head higher.
Possible trades are on both sides but mainly on upside, gold can be bought above $2045 for the targets of $2061 and $2090 with a stop loss placed below $2030. Longer term target $2109.
Dips towards support (and breakout region) can be used to create longs for the above mentioned targets.
Shorts can be useful for scalp trades only.
On the chart –
Gold hurried over $2000 as shorts continued to get punished partly due to immense liquidity and party cause of technical push. Its getting more and more stretched on the upside but still this overbought state is not acting as much of a roadblock for further gains since charts can stay in such a condition if situations persist/demands which is the actual reality at the moment. With more stimulus, this is not looking like stopping anytime soon until an exhaustion limit is reached. Technicals remain favorable as its creating fresh highs and new closing ones as well moreover every week with no reversal pattern in sight. We have 2 scenarios –
1. Gold closed above the support, till this is held it can go to $2061. If this is crossed it can move towards $2090. And if this is taken out it can rally to $2109.
2. Short bets still remain an ill fated option except scalp trades.
Bullish view – Bulls achieved another milestone as they conquered $2000 for the first time on back of a lower dollar and ample liquidity. This straight $230 point rally in span of 3 weeks does showcase the prowess of the bulls as they were unforgiving to any shorting opportunity rather the recurring shorts fueled the upmove. There was a slight hiccup at the end of last week where the metal pulled back quite sharply from highs (maybe due to week ending adjustment) as stimulus talks hit a roadblock, but all seems well now post signing of an executive order in the weekend by President Trump to keep the stimulus going which should put back gold into its ascending course as likely the dollar will get another blow. Other than this, ongoing concerns remain elevated as pandemic continues to rattle the economies while geopolitical tensions fail to ease. With the above considerations its highly likely for gold to reach $2300 and maybe even higher before a major correction sets in.
Bearishness still remains off grid.
On larger terms, Gold remains bullish and prices are expected to head higher.
Possible trades are on both sides but mainly on upside, gold can be bought above $2045 for the targets of $2061 and $2090 with a stop loss placed below $2030. Longer term target $2109.
Dips towards support (and breakout region) can be used to create longs for the above mentioned targets.
Shorts can be useful for scalp trades only.
Trade active