Gold prices are set to spring higher after more than a month of moving sideways, according to one analyst.
Drivers include a positive technical backdrop and the likelihood of sustained low interest rates in the world’s largest economies that may prompt investors to seek better returns in other “safe haven” investments.
The upbeat technical backdrop is getting an assist from monetary policy. The Bank of Japan on Thursday held its key rate at -0.1% and warned the economy remains in a challenged state, but is showing some signs of recovery. The Bank of England also kept policy on hold on.
The announcements come a day after the Federal Reserve held its benchmark interest rate at a range between 0% and 0.25% and said it expects to keep rates low through 2023 while navigating the U.S. economy through its sharpest slowdown of the post-World War II era.
The central bank put into place the policy strategy announced last month that would let inflation run above its 2% target for some time.
Overall, the bias in prices is: Upwards.
The projected upper bound is: 2,033.66.
The projected lower bound is: 1,875.47.
The projected closing price is: 1,954.56.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 32 white candles and 18 black candles for a net of 14 white candles.
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 43.9983. This is not an overbought or oversold reading. The last signal was a buy 8 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 52.23. 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 28 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 17. This is not a topping or bottoming area. The last signal was a sell 12 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 buy 2 period(s) ago.
Rex Takasugi – TD Profile
PREC.M.XAU= closed up 8.897 at 1,951.497. Volume was 8,900% above average (trending) and Bollinger Bands were 58% narrower than normal.
Open High Low Close Volume 1,942.870 1,955.193 1,940.790 1,951.497 25,973
Technical Outlook Short Term: Neutral Intermediate Term: Bearish Long Term: Bullish
Moving Averages: 10-period 50-period 200-period Close: 1,946.73 1,935.04 1,715.29 Volatility: 10 26 23 Volume: 2,597 519 130
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 13.8% above its 200-period moving average and is in an downward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future.
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 18 periods.