Gold 1 OZ (XAU=X) Analyst warn of a near-term market top in prices
Gold futures on Monday marked their highest settlement since April of 2013, as the killing last week of a top Iranian military commander, Qassem Soleimani, reverberated through financial markets, momentarily upending appetite for assets considered risky and boosting traditional haven assets like gold.
February gold GCG20, +0.94% on Comex added $16.40, a gain of 1.1%, to settle at $1,568.80 an ounce, after it briefly touched $1,590.90 in intraday action. The most active contract saw its highest settlement since April 9, 2013, according to FactSet data. Gold also rose for a ninth consecutive session, its longest period of straight gains since an 11-day streak that ran from December 2018 to January 2019.
A weaker buck can make gold more attractive to buyers using other currencies, and lower bond yields can also help boost the comparative appeal of gold against government debt.
“Gold continues its breakout higher as it is now at the highest level since April 2013,” wrote Peter Boockvar, chief investment officer at Bleakley Advisory Group, in a Monday research report.
“I remain bullish but caution not to buy it on geopolitical concerns because as stated they are usually temporary. Buy it instead because the dollar continues to weaken and real yields continue to fall,” he said.
The platinum group markets are “not concerned that recent geopolitical events could derail the global economy and therefore demand for auto catalysts,” analysts at Zaner Metals, wrote in daily note. “Instead, it is apparent that platinum and palladium are being considered as safe haven instruments, with classic physical market fundamentals being pushed to the sidelines.”
Overall, the bias in prices is: Upwards.
Note: this chart shows extraordinary price action to the upside.
By the way, prices are vulnerable to a correction towards 1,499.34.
The projected upper bound is: 1,593.87.
The projected lower bound is: 1,540.44.
The projected closing price is: 1,567.16.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 8 white candles and 1 black candles for a net of 7 white candles. During the past 50 bars, there have been 30 white candles and 19 black candles for a net of 11 white candles.
A long upper shadow occurred. This is typically a bearish signal (particularly when it occurs near a high price level, at resistance level, or when the security is overbought).
A rising window occurred (where the top of the previous shadow is below the bottom of the current shadow). This usually implies a continuation of a bullish trend.
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 86.3719. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 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 85.34. This is where it usually tops. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 93 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 198.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 21 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 26 period(s) ago.
Rex Takasugi – TD Profile
PREC.M.XAU= closed up 14.290 at 1,565.693. Volume was 8,900% above average (trending) and Bollinger Bands were 96% wider than normal.
Open High Low Close Volume___
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 1,521.41 1,482.87 1,425.35
Volatility: 9 11 14
Volume: 7,178 1,436 359
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= gapped up today (bullish) on heavy volume. Possibility of a Breakaway Gap which usually signifies the beginning of a major market move. Four types of price gaps exist – Common, Breakaway, Runaway, and Exhaustion. Gaps acts as support/resistance.
PREC.M.XAU= is currently 9.8% 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 15 periods. Our momentum oscillator is currently indicating that XAU= is currently in an overbought condition.