There’s nothing that markets like more than clarity and certainty, which 2020 has been short of in many ways.
It’s hard to imagine a case in which the gold price wouldn’t continue moving upward. A Biden presidency would mean panic in markets, and investors fleeing to gold to protect their assets. But a Trump victory would mean at best a momentary pause in market uncertainty. At some point, the underlying economic fundamentals will find themselves reflected in market behavior, and stocks will finally enter the long-term correction many have been expecting for years. And when that happens, gold could very well see price increases in line with its 2008-2011 bull market, or even better.
Playing a major role in the future of the gold price will be the prospect of any stimulus, whether fiscal or monetary. And no matter who wins the Presidency, the likelihood of stimulus is high. Now that all the electioneering is over, and stimulus is no longer a political football that can be used to score points, there’s a higher probability that Congress will pass a stimulus bill, perhaps even by the end of the year.
One of the questions that will need to be answered is whether Nancy Pelosi takes advantage of her majority to try to push something through before January 3rd, or whether she waits for a smaller majority but a possibly tighter Senate to try to pass some sort of stimulus. But regardless of the timing, further stimulus seems a certainty.
The further stimulus should provide a boost to the gold price, not only because some of that money will eventually trickle down into the gold market, but also because it will signal that the economy remains weak, and that the case for buying gold remains strong. Indeed, it’s hard to imagine that further stimulus could do anything but strengthen the gold price. Whether it’s a weakening economy, further COVID lockdowns, or new government policies weighing on the economy, times like these are made for investing in gold to protect your assets.
Overall, the bias in prices is: Upwards.
The projected upper bound is: 1,992.61.
The projected lower bound is: 1,889.06.
The projected closing price is: 1,940.84.
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 87.6517. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 23 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 59.01. 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 63 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 190.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a buy 4 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 down -7.261 at 1,941.299. Volume was 8,900% above average (trending) and Bollinger Bands were 44% narrower than normal.
Open High Low Close Volume 1,948.790 1,949.448 1,938.000 1,941.299 4,853
Technical Outlook Short Term: Overbought Intermediate Term: Bullish Long Term: Bullish
Moving Averages: 10-period 50-period 200-period Close: 1,902.72 1,913.39 1,778.65 Volatility: 19 17 24 Volume: 485 97 24
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 9.1% above its 200-period moving average and is in an upward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods.
Our volume indicators reflect very strong flows of volume into XAU= (bullish). Our trend forecasting oscillators are currently bullish on XAU= and have had this outlook for the last 2 periods.