CommoditiesTrader
Long

Gold Continues in Falling Wedge with Fib. Support

FX:XAUUSD   Gold / U.S. Dollar
Gold             is hated but most because it is the antithesis of greed, which has been feed for years by central banks around the world.

I'll be frank, I was rather bearish on the shiny metal an forecasted $1,035 per toz. in 2013. However, as the charade of lackluster growth and quasi-monetary policy continued, gold's fundamentals are bullish .

It is too simplistic to relate gold             to the dollar (in terms of performance) or inflation . At its root, gold             is the ultimate currency hedge; and if you have your money on the Fed to come out of this unscathed.. well, they will - you might not be so lucky.

Price action has been range bound forever it seems (please check out previous ideas), but given the onslaught of hopes and dreams of a global economic recovery, gold             has been supported thus far.

A falling wedge is a bullish reversal pattern, and it could be worth watching as the Fed (and most recently the BoJ) talk down the dollar. The volatility in the dollar is alarming on its own.

Price action has been supported by a large demand zone that has been evidence since late 2009. Clearly, a close below that is very bearish , and sub-$1,000 could be possible but it might not be probable in current conditions.

Gold             will need a catalyst, and the lack of credibility in the Fed will be key. If June and September come and go without a rate hike, gold             could easily find comfort above $1,300 per toz.

To assume the Fed will rise interest rates on a single positive data-point (non-farm payrolls) is myopic. There are no trends in inflation or growth.

Keep in mind, the US was in the Great Recession for seven months before the Fed acknowledged it, as it was still projecting growth.

Technically, there is support until otherwise broken.
yes completely agree!
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Did you see the rising wedge in the falling wedge? And the full symmetry that from my point of view so far is happening?
snapshot
+1 Reply
Yahia.Awes Yahia.Awes
Rising channel refuses price to get in 3 times. So big resistance found there.
snapshot
+1 Reply
Well yes, gold is capped so far due to market sentiment. Many of my pieces focus on the very large range between $1,134 and $1,265ish.

MACD looks to turn positive on your chart :D But, really gold could fall like a brick if that supply zone is broken, on the flip side the longer it remains supports given the bearish sentiment, I believe the better the outlook.

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I have a slightly different wedge.
https://www.tradingview.com/chart/ksy3t89q/
+1 Reply
Looks more like a symmetrical triangle, but a trade could be played on a breakout. The larger wedge is interesting given the murky fundamental picture for the us economy and dollar
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Crinklebine PRO CommoditiesTrader
I agree, good luck and best trading. :-)
+1 Reply
Thank you! You too. Look forward to your posts
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