Gold continued to consolidate after making a higher high posting a minor negative return for the week. It is still stuck in a range but saw an expansion on the upside which should augur well for the bulls. As the year comes closer to an end, volumes should remain light with no directive move but December has been a good month for gold historically. Fundamentals remain uncertain with news flow coming on either directions while technical angle is still humming a bullish tone. The week is the most important one of December with key market moving events lined up which should further carve the path of gold. To watch this week – U.S interest rate decision, ECB interest rate decision, UK election and other important data.
On the chart –
Gold remained in consolidation for 4th straight week as coming holiday season woes any directive movement. Fundamentally gold does not seem to choose a direction as it changes almost every day keeping the uncertainty at the highest. Technicals though not showing a constructive signal is still in favor of bulls as price may have formed a near term bottom. We have 2 scenarios –
1. Gold closed above the support, till this is held it can go to $1480. If this is crossed it can move towards $1495. And if this is taken out it can rally to $1510.
2. With a near term bottom in place likely, it has become quite hard for the bears to gain attention but if the support/low breaks it can move to $1434 and $1420.
Bullish view – Bulls came out all guns blazing as they created a higher high but eventually failed to capitalize on the gains itself owing to easing of trade tensions. The week ahead has much needed important events which should help create a decisive move looks to favor bulls as broadly it could result in a lower dollar which in turn should push up gold. For bulls to keep the trend in their favor they need to keep making new highs and defend the supports.
Bearish view – Bears made an impression as they pulled back the price from the highs in another attempt to take command of the trend. Fundamental support is there for the bears but technically the structure favors the bulls. For bears to take charge they need to break the supports.
On larger terms, Gold remains sideways and prices are expected to be rangebound until a direction is confirmed.
Possible trades are on both sides but mainly on upside, gold can be bought above $1465 for the targets of $1480 and $1495 with a stop loss placed below $1456. Longer term target $1510.
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 until the direction is decided.
On the chart –
Gold remained in consolidation for 4th straight week as coming holiday season woes any directive movement. Fundamentally gold does not seem to choose a direction as it changes almost every day keeping the uncertainty at the highest. Technicals though not showing a constructive signal is still in favor of bulls as price may have formed a near term bottom. We have 2 scenarios –
1. Gold closed above the support, till this is held it can go to $1480. If this is crossed it can move towards $1495. And if this is taken out it can rally to $1510.
2. With a near term bottom in place likely, it has become quite hard for the bears to gain attention but if the support/low breaks it can move to $1434 and $1420.
Bullish view – Bulls came out all guns blazing as they created a higher high but eventually failed to capitalize on the gains itself owing to easing of trade tensions. The week ahead has much needed important events which should help create a decisive move looks to favor bulls as broadly it could result in a lower dollar which in turn should push up gold. For bulls to keep the trend in their favor they need to keep making new highs and defend the supports.
Bearish view – Bears made an impression as they pulled back the price from the highs in another attempt to take command of the trend. Fundamental support is there for the bears but technically the structure favors the bulls. For bears to take charge they need to break the supports.
On larger terms, Gold remains sideways and prices are expected to be rangebound until a direction is confirmed.
Possible trades are on both sides but mainly on upside, gold can be bought above $1465 for the targets of $1480 and $1495 with a stop loss placed below $1456. Longer term target $1510.
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 until the direction is decided.
Comment:
As expected dollar down on first event of the week
Trade active
Comment:
First long target met at $1480