Gold oversold intraday but continuing correction towards 1297

FX:XAUUSD   Gold Spot / U.S. Dollar
The 1327 retracement level has been breached today following the sustained bounce in 10 year yields. Although the market is looking oversold intraday, I expect the correction to continue to potentially as low as 1297 before becoming attractive again from the long side.

I remain bullish on gold             medium and long term (as I have been all year) with a year-end price target of $1400-1425 following a correction. In the short term over the coming quarter I would not be surprised to see gold             contained within a 100 point range of $1300-1400, presenting an attractive risk/reward skew for longs.
Comment: We have seen a bounce from an oversold reading and bullish divergence on the hourly RSI overnight.

What is most interesting is that the 1327 retracement level appears to be acting as support for gold having successfully tested (and held) during Asian trading.

A new intraday high above 1337 would set a higher-high (hourly) with a higher-low (hourly) established overnight around the 1327 area of interest, suggesting that the longer-term (daily) correctional move from the 23rd June low to 6th July high is complete, heralding new highs and run at $1400
Comment: Gold appears to be pinned at the 1327 level which I had as a key target for support this week.

Notably, gold failed to see 1337 intraday and as such has not established a higher-high on an intraday basis (negative bias remains). Therefore, 1327 should remain an area of attraction heading into the start of trading next week, with a decisive move in either direction away from this level signalling either a continued correction towards 1297 on the downside, or a run up towards the June 6th high at 1375.

A stronger dollar and resurgent US yields seen today suggest that the probabilities are tilted in the favour of a deeper correction.
Trade closed manually: Turkish army has apparently seized control of country, reports of social media blackouts. Gold has spiked $10 to a new intraday high (by a few ticks) at 1337 which had been the key intraday pivot coming in to the session this morning. If you are short it would be sensible to cover as the situation could escalate over the weekend.

To be reassessed Monday. Flat, still buyer at 1297 if seen.
Comment: Gold has opened Sunday trading down $6, having rallied after the US equity market close on Friday to the intraday bullish pivot level of 1337 on news of a coup in Turkey.

The market appears to be viewing the incident as a contained situation and safe haven assets are offered.

1347.05 provides the upside pivot for bulls this week, otherwise expect price to re-test 1327 with the odds slightly in favour of a deeper correction towards the 62% retracement level at 1297 (where my technical bias will confirm my fundamental view and favour buying).
Comment: As of 8am London, gold is starting the week back at the key 1327 level seen last week
If gold sees $1300 this week/next, I expect this to be the final buying opportunity before the next move toward $1400 in Q3 '16 and possibly 1561 by early 2017
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