Daily Timeframe: The shows that the reaction seen around the daily Quasimodo at 1221.1 on Tuesday did initially appear to display signs of selling strength. However, Friday’s trading action put a stop to this as price rallied and closed above this daily Quasimodo . As a result, this likely clears the path north for the buyers to attack a daily supply area coming in at 1238.1-1227.7 (located just within the aforementioned weekly supply area). It will be interesting to see what the 4hr timeframe shows.
4hr Timeframe: For those who follow our analysis on a regular basis, you may recall us mentioning that we were intending to watch for lower-timeframe buying confirmation around a 4hr decision-point demand area at 1201.5-1204.7 after the NFP numbers were released. Unfortunately, as you can see, there was very little chance for us to enter long with confirmation before price rallied higher.
All is not lost though. With the depicting weakness within the aforementioned weekly supply area, and the indicating that there’s room to move north, we’re still confident higher prices are likely going to be seen this week.
The 4hr timeframe shows that price closed for the week at a very significant level in our view – 1222.9, the high formed on Tuesday. Why is this important? Well, as far as we can see, above 1222.9 is relatively clear of active supply up to a 4hr supply area coming in at 1244.5-1240.1 (located deep within the aforementioned weekly supply area). Check out the very obvious supply consumption wicks seen within the green arc shape at 1197.6/1231.8/1232.6.
Therefore, with all of the above taken into consideration, we have absolutely no interest in selling Gold at this point in time. Buying Gold however would be permitted if price convincingly breaks above 1222.9, this would effectively be our cue to look to trade any confirmed retest targeting 1239.6, just below the aforementioned 4hr supply area.
Current buy/sell levels:
• Buy orders: Flat (Predicative stop-loss orders seen at: N/A).
• Sell orders: Flat (Predicative stop-loss orders seen at: N/A).