Gold price has bounced back in the past few days and analysts at Citi expect the rally to accelerate. This month, the price has moved from November’s low of $1,765 to the present high of $1,867. That is a 6% increase. Similarly, other metals like copper and platinum have also been pushing higher.
There are three main reasons why the price of gold has been rising. First, the US dollar has been making fresh lows in the past few days. Today, the dollar index is trading at $90.82, which is close to last week’s low of $90.48. This was the lowest level the metal has been since 2018. Gold and the USD usually have an inverse relationship.
Second, gold price has risen because many analysts believe that it was getting cheap and oversold. That’s after it dropped by more than 10% from its November high of $1,965.
Finally, the price of Bitcoin has been wavering recently, which has possibly seen more investors move their funds back to gold. Precisely, the price has oscillated at around $19,000 in the past few weeks.
Meanwhile, analysts at Citi remain optimistic about gold prices. In their closely-watched annual commodity outlook, they said that they expect that the metal will soar to about $2,100 in the coming year. That would be a 12% increase from the current level.
Overall, the bias in prices is: Sideways.
By the way, prices are vulnerable to a correction towards 1,866.31.
The projected upper bound is: 1,930.59.
The projected lower bound is: 1,801.51.
The projected closing price is: 1,866.05.
A black body occurred (because prices closed lower 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 28 white candles and 22 black candles for a net of 6 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 92.1309. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a buy 6 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 53.09. 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 buy 6 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 103.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a buy 6 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 3 period(s) ago.
Rex Takasugi – TD Profile
PREC.M.XAU= closed down -4.930 at 1,866.430. Volume was 8,900% above average (trending) and Bollinger Bands were 3% wider than normal.
Open High Low Close Volume 1,870.810 1,870.860 1,865.700 1,866.430 3,740
Technical Outlook Short Term: Overbought Intermediate Term: Bearish Long Term: Bullish
Moving Averages: 10-period 50-period 200-period Close: 1,830.10 1,877.89 1,807.31 Volatility: 18 22 24 Volume: 374 75 19
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 3.3% 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 out of XAU= (bearish). Our trend forecasting oscillators are currently bearish on XAU= and have had this outlook for the last 16 periods.