Gold had a fall of over $10 in a yet another range bound week. Price action has seemingly lost volatility and is confined within a strict 40$-45$ range. Last week gold found resistance at $1331 before retreating and falling to lows of $1309 where it found support of the 20 day moving average and bounced off. Technically the closing price is under the support of $1317 which suggests signs of bearishness which may lead it to test $1300 again. But if the 20 day moving average is respected then upmove cannot be ruled out but again it will be contained in the range.
On the chart –
Gold’s straight 3rd week of increasingly low volatility and sideways action offered little to the bulls and bears but it continued to register lower highs for 5th consecutive week. Resistances were respected so were the supports so it continues to be confusing but this week’s cut and closing suggests bias is more on the downside. We have 2 scenarios –
1. Gold’s holding onto the support of 20 day moving average and a bounce from there suggests buying still may be present at lower levels. If the supports are held and if gold manages to cross $1317 it can go higher till $1331. If this resistance is crossed it can move towards $1345.
2. Gold had a poor closing which suggests it might retest the support at $1308 again. If this is breached then it can fall towards $1297.
Bullish view – Bulls are waning out on week to week basis and this is not good for the price action to move ahead with force. Only consolation bulls can take home is they were able to protect the downside via the support of 20 day moving average which was respected and prices bounced from there. For bulls holding of $1300 is the most important to keep themselves in the fray, till it is held they have can have a fight back to push the prices higher.
Bearish view – Bears are clear winners as one by one supports are getting broken on weekly basis. Bears were able to defend the $1331 mark and added to the downside pressure by pushing the prices towards 20 day moving average but failed to breach that, still they won the week as they managed to get the closing under the support of $1317. To keep the momentum on the downside they must defend $1317 and try to erode the support area of $1308.
On larger terms, Gold remains sideways with a bearish bias as the closing was not upto the mark and may lead to more downside. But on a broader picture gold is still confined in a range and it must break on either side for a decisive trend.
Possible trades are on both sides, gold can be bought above $1320 for the targets of $1331 and $1345 with a stop loss placed below $1317.
Short trades comes into the picture once $1308 breaks for the target of $1297 with a stop loss placed above $1314.
On the chart –
Gold’s straight 3rd week of increasingly low volatility and sideways action offered little to the bulls and bears but it continued to register lower highs for 5th consecutive week. Resistances were respected so were the supports so it continues to be confusing but this week’s cut and closing suggests bias is more on the downside. We have 2 scenarios –
1. Gold’s holding onto the support of 20 day moving average and a bounce from there suggests buying still may be present at lower levels. If the supports are held and if gold manages to cross $1317 it can go higher till $1331. If this resistance is crossed it can move towards $1345.
2. Gold had a poor closing which suggests it might retest the support at $1308 again. If this is breached then it can fall towards $1297.
Bullish view – Bulls are waning out on week to week basis and this is not good for the price action to move ahead with force. Only consolation bulls can take home is they were able to protect the downside via the support of 20 day moving average which was respected and prices bounced from there. For bulls holding of $1300 is the most important to keep themselves in the fray, till it is held they have can have a fight back to push the prices higher.
Bearish view – Bears are clear winners as one by one supports are getting broken on weekly basis. Bears were able to defend the $1331 mark and added to the downside pressure by pushing the prices towards 20 day moving average but failed to breach that, still they won the week as they managed to get the closing under the support of $1317. To keep the momentum on the downside they must defend $1317 and try to erode the support area of $1308.
On larger terms, Gold remains sideways with a bearish bias as the closing was not upto the mark and may lead to more downside. But on a broader picture gold is still confined in a range and it must break on either side for a decisive trend.
Possible trades are on both sides, gold can be bought above $1320 for the targets of $1331 and $1345 with a stop loss placed below $1317.
Short trades comes into the picture once $1308 breaks for the target of $1297 with a stop loss placed above $1314.
Comment:
Trade Active
Comment:
First bullish target met at $1331
Comment:
Second bullish target met at $1345
Trade closed: target reached