Gold had a small green week mainly owing to a negative movement in dollar and a dull risk on activity along with the broader aspect of safe haven buying due to continued uncertainty caused by the ongoing pandemic which is still unleashing its wrath in many parts of the globe. It does seem the world is awaiting a trigger to get a more directive approach though the trend looks to be already set in place its just that the fuel is on the lower side, and the most awaited trigger could be the extra large stimulus which would offer ample push in the direction. Else the fundamentals remain the same with no notable difference as events come and go but the level of uncertainty refuses to die down. To watch next week – Stimulus, earnings and other important economic data.
On the chart –
Gold made a pin bar or a reversal candle which would be validated on the next open though there may still be some room for a pull back as the double bottom pattern is yet not convincingly printed. Technically, gold remains a buy on dips since it remains in consolidation until a clear direction is achieved. We have 2 scenarios –
1. Gold closed above the support, till this is held it can go to $1839. If this is crossed it can move towards $1857. And if this is taken out it can rally to $1875.
2. Bears still have a chance to change the trend in their favor if they invalidate all possible bullish patterns and the always available scalp trades.
Bullish view – Bulls tried again to surge higher as they were successful in defending $1800 but were denied again as the consolidation continues in the yellow metal. The candle formed shows early signs of reversal which to a certain extent increases the belief in bullish bets even if the full reversal pattern hasn’t formed as yet. Fundamentally, bulls remain buoyed as the current situations are not showing any signs of stability and if one thing gets resolved another remains ready to fill up the empty space in the uncertainty bar. For bulls to remain in the game they need to prevent the invalidation(s) of bullish patterns formed or in formation.
Bearishness still has an outside chance if bullish patterns are denied to be formed.
On larger terms, gold continues to remain bullish and prices are expected to head higher.
Possible trades are on both sides but mainly on upside, gold can be bought above $1828 for the targets of $1839 and $1857 with a stop loss placed below $1817. Longer term target $1875.
Dips towards support (and breakout region) can be used to create longs for the above mentioned targets.
Shorts can be useful for scalp trades only.
On the chart –
Gold made a pin bar or a reversal candle which would be validated on the next open though there may still be some room for a pull back as the double bottom pattern is yet not convincingly printed. Technically, gold remains a buy on dips since it remains in consolidation until a clear direction is achieved. We have 2 scenarios –
1. Gold closed above the support, till this is held it can go to $1839. If this is crossed it can move towards $1857. And if this is taken out it can rally to $1875.
2. Bears still have a chance to change the trend in their favor if they invalidate all possible bullish patterns and the always available scalp trades.
Bullish view – Bulls tried again to surge higher as they were successful in defending $1800 but were denied again as the consolidation continues in the yellow metal. The candle formed shows early signs of reversal which to a certain extent increases the belief in bullish bets even if the full reversal pattern hasn’t formed as yet. Fundamentally, bulls remain buoyed as the current situations are not showing any signs of stability and if one thing gets resolved another remains ready to fill up the empty space in the uncertainty bar. For bulls to remain in the game they need to prevent the invalidation(s) of bullish patterns formed or in formation.
Bearishness still has an outside chance if bullish patterns are denied to be formed.
On larger terms, gold continues to remain bullish and prices are expected to head higher.
Possible trades are on both sides but mainly on upside, gold can be bought above $1828 for the targets of $1839 and $1857 with a stop loss placed below $1817. Longer term target $1875.
Dips towards support (and breakout region) can be used to create longs for the above mentioned targets.
Shorts can be useful for scalp trades only.