The week ahead on Gold...

FX:XAUUSD   Gold Spot / U.S. Dollar
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Weekly Timeframe: Last week saw Gold decrease in value as price closed below a relatively important weekly swap level seen at 1251.5. This move was likely fuelled by positive U.S employment data released on Friday. Consequent to price breaking lower here, one should refrain from getting too excited since potential weekly support is seen coming in just below at 1222.2; it will be interesting to see what the lower timeframe picture has to say about this…

Daily Timeframe: Friday’s rather aggressive sell off saw price hit a daily decision-point demand area seen at 1224.9-1235.7 (sitting just above weekly support at 1222.2). We believe this zone to be significant since this is likely where pro money made the ‘decision’ to break above the weekly swap level (see above), and it is for this reason that unfilled buy orders may well still reside here.

4hr Timeframe: Much like the daily timeframe , the 4hr timeframe saw price hit a 4hr decision-point demand area at 1224.9-1232.1 (seen deep within the aforementioned daily decision-point demand area) at around 3pm GMT time on Friday.

Buying from this 4hr decision-point demand area and targeting the weekly swap level above at 1251.5 is in our opinion a valid strategy, BUT and we have capitalized the word ‘but’ here for good reason! Entering long at this area of demand should be done with caution, as one would need to be prepared for price to fake lower down into the weekly support coming in just below it marked in green at 1222.2. For this reason, we have decided to play this cautiously and wait for price action on the lower timeframe to confirm whether this area has strength before putting our money at risk.

Current buy/sell levels:

• Buy orders: currently watching for lower timeframe confirmation around the 4hr decision-point demand area at 1224.9-1232.1 (Predicative stop-loss orders seen at: dependent on where one confirms this area).

• Sell orders: Flat (Predicative stop-loss orders seen at: N/A).

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