A rally in the stock market does not mean investors have forgotten their fear, which is why “gold’s story is not over yet.
After a precipitous vaccine news-driven decline, gold’s current price levels still leave unanswered questions. Despite seemingly buoyant markets, we do not think that investors have forgotten their fear; thus gold’s story is not yet over amid ongoing economic, financial, and political uncertainty.
Vaccine news does not automatically fix the economic downturn the U.S. has seen this year. It does not solve all the other problems, including inflation and unemployment, the report noted.
2020 has been a year of uncertainty, underscored by a pandemic, an economic crisis, heightened political tensions, and a confluence of gold-positive drivers. While we may have seen a reset of sorts in gold’s valuation, its path is not predetermined as we barrel towards 2021.
Last Monday, Pfizer/BioNTech vaccine news saw gold prices tumble $100, followed by step-by-step recovery. This Monday, Moderna’s vaccine news also sent gold sown more than $25. But this time around, losses were very quickly recovered.
At the time of writing, December Comex gold futures were trading at $1,889.00, up 0.25% on the day.
Gold’s drop last week represented a reset of gold-related pandemic expectations, a repricing of stimulus expectations by gold investors, a realignment of inflation fears, and a shift in mindset around post-election political uncertainty.
But this reset does not mean gold’s moves higher are over.
Overall, the bias in prices is: Sideways.
By the way, prices are vulnerable to a correction towards 1,898.70.
The projected upper bound is: 1,952.17.
The projected lower bound is: 1,824.80.
The projected closing price is: 1,888.49.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 30 white candles and 20 black candles for a net of 10 white candles.
A doji star occurred (where a doji gaps above or below the previous candle). This often signals a reversal with confirmation occurring on the next bar.
Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 52.0431. This is not an overbought or oversold reading. The last signal was a buy 2 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 48.26. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 70 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -11. This is not a topping or bottoming area. The last signal was a buy 3 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 4 period(s) ago.
Rex Takasugi – TD Profile
PREC.M.XAU= closed up 0.802 at 1,889.320. Volume was 8,900% above average (trending) and Bollinger Bands were 29% narrower than normal.
Open High Low Close Volume 1,888.760 1,892.160 1,886.100 1,889.320 15,603
Technical Outlook Short Term: Neutral Intermediate Term: Bearish Long Term: Bullish
Moving Averages: 10-period 50-period 200-period Close: 1,894.80 1,904.39 1,789.62 Volatility: 33 21 24 Volume: 1,560 312 78
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
PREC.M.XAU= is currently 5.6% above its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term.
Our volume indicators reflect very strong flows of volume into XAU= (bullish). Our trend forecasting oscillators are currently bearish on XAU= and have had this outlook for the last 0 periods.