ICmarkets

Gold: Weekly technical outlook and review...

FX:XAUUSD   Gold/U.S. Dollar
344 0 4
Weekly recap:

Ever since price crossed paths with the weekly Quasimodo support barrier at 1074.6, the Gold             market has been relatively quiet with very little gains/losses to report. That being said, however, during this quiet spell, price action painted back-to-back buying tails on the weekly timeframe , which suggests there are still willing bids in and around this region. Turning our attention to the daily timeframe , we can see that price has spent the last two weeks hugging a long-term daily swap (support) barrier at 1088.2, which sits just above the aforementioned weekly Quasimodo support. Finishing up with the 4hr timeframe, Friday’s trade shows that price continued to Ping-Pong within its current supporting barriers last week – the 4hr demand at 1077.1-1083.5 and 4hr supply at 1105.6-1099.2.

This morning’s opening price 1093.7 saw a steady wave of offers come into this market, consequently pushing prices back into the current 4hr range.

In the event that the buyers can successfully hold out above the aforementioned long-term daily swap (support) barrier today/tomorrow, we feel that with this – and the fact that price is still trading above the weekly Quasimodo support may attract buyers into this market.

Given the points made above, there are two avenues we’re currently looking at today/this week:

1. Trade the limits of the present 4hr consolidation zone (watch for a fakeout below this range though into the weekly Quasimodo support). Our team has come to a general consensus that entering long or short within this area will require lower timeframe confirmation before a position is considered.

2. In the event that price closes above the upper limit of the 4hr range, the path north would then likely be clear for buying up the 4hr supply zone sitting at 1134.5-1128.9 (conveniently positioned around the weekly swap level at 1130.1). However, to trade this potentially humongous move, we’d require a retest of this broken zone as demand along with corresponding lower timeframe price action confirmation.

Levels to watch/ live orders:

• Buys: 1077.1-1083.5 Tentative – confirmation required (Stop loss: dependent on where one finds confirmation in this area). Watch for 1105.6-1099.2 to be consumed and then look to enter on a confirmed retest seen at this area.
• Sells: 1105.6-1099.2 Tentative – confirmation required (Stop loss: dependent on where one finds confirmation in this area).

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