On the chart –
Gold made a repetitive move again demonstrating the lack of direction before any big event as it always is the case. It might look worn out on the upside but this could be the way to shake off retail positions before a directive move. Technically gold still remains in the breakout as the pattern supports are being held quite smartly as is the 20 day moving average. We have 2 scenarios –
1. Gold closed above the support, till this is held it can go to $1921. If this is crossed it can move towards $1945. And if this is taken out it can rally to $1963.
2. bets remain absent in such a scenario.
view – Bulls reclaimed $1900 again on account of a falling dollar and sharp rise in uncertainty owing to upcoming U.S presidential elections and surging virus cases across the globe as 2nd wave of the pandemic takes the center stage denting economic recovery if any. Moreover the lull in gold price should not be mistaken for an exhaustion as it simply awaits a direction which should likely happen post Nov 3 event and the move is expected on the upside given the safe haven aspect and a perceived breakdown in dollar. Technicals might not be that supportive/conclusive at the moment but fundamentals remain strongly in favor of bulls with the price expected to make fresh highs till supports are held.
Bearishness continues to remain out of context.
On larger terms, gold remains and prices are expected to head higher.
Possible trades are on both sides but mainly on upside, gold can be bought above $1915 for the targets of $1921 and $1945 with a stop loss placed below $1904. Longer term target $1963.
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.