ICmarkets

Gold: Technical outlook and review.

FX:XAUUSD   Gold / U.S. Dollar
202 0 0
Weekly Timeframe: The weekly timeframe shows that Gold             has been moderately bullish since hitting the weekly decision-point demand level seen at 1136.3 on 03/11/14. Nonetheless, signs of weakness over the past four weeks or so have begun to show just below a weekly supply area coming in at 1255.2-1226.1.

Daily Timeframe: The rebound seen from the daily Quasimodo resistance level at 1221.1 on Tuesday has recently extended lower. Assuming that the sellers continue with this enthusiasm, a move south will likely follow down to a minor daily S/R swap level seen at 1200.00 and possibly given enough time, a major daily swap level coming in at 1182.0. Let’s see what the 4hr timeframe has to say about this.

4hr Timeframe: Both the weekly and daily timeframes are indicating buying weakness at the moment. However, the 4hr timeframe is telling a completely different story in our view. Take a look and see what you think.

After price broke out of a 4hr range (1211.3/1172.8) on the 06/01/15, it effectively cleared the path north towards a 4hr supply area coming in at 1244.5-1240.1 (located deep within the aforementioned weekly supply). The reason why we believe price can trade thus high is simply because we see very little active supply between 1212.1 and the 4hr supply area (green arc pattern). And also, more recently, further supply consumption is being seen (shown with a black downtrend line) into a small 4hr decision-point demand area at 1201.5-1204.7. This area is relatively significant to us, since it was here where pro money likely made the decision to close prices above the aforementioned 4hr range.

This also shows that if the NFP numbers are positive, there will be very little to stop price rallying all the way up to the aforementioned 4hr supply area. What this also highlights as well is that shorting the daily Quasimodo resistance level (see above) may not be the best path to take at the moment, since it would not take a lot of buyers in scheme of things to push prices higher into this consumed supply. And when there are fewer sellers than buyers – price goes up!

Since it is NFP day today, we intend to wait for the numbers to be released first, and then (if positive of course) begin looking for confirmed long setups around the current 4hr decision-point demand area mentioned above at 1201.5-1204.7.

Current buy/sell levels:

• Buy orders: Post NFP, we’ll be watching for lower-timeframe confirmed entries around 1201.5-1204.7 (Predicative stop-loss orders seen at: 1200.6).

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



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