Gold 1 OZ (XAU=X) appears to have shifted to a “buy the dips” mentality from the “sell the rallies”
Gold prices are posting good gains and are near last week’s six-year high of $1,415.40 in August futures. Safe-haven demand amid heightened geopolitical events is keeping gold prices on the rise. Also, a slumping U.S. dollar index that hit a three-month low today is also working in favor of the precious metals markets.
Trader psychology in the gold and silver markets appears to have shifted to a “buy the dips” mentality from the “sell the rallies” attitude that had been in place since last winter. August gold futures were last up $11.50 an ounce at 1,411.60. July Comex silver prices were last up $0.04 at $15.33 an ounce.
Technically, the gold bulls have the strong overall near-term technical advantage. Prices are in an accelerating four-week-old uptrend on the daily bar chart. Bulls’ next upside price objective is to produce a close in August futures above solid resistance at $1,450.00.
Bears’ next near-term downside price breakout objective is pushing August futures prices below solid technical support at $1,361.50. First resistance is seen at last week’s high of $1,415.40 and then at $1,425.00. First support is seen at today’s low of $1,403.60 and then at $1,400.00.
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 1,333.52.
The projected upper bound is: 1,445.48.
The projected lower bound is: 1,396.35.
The projected closing price is: 1,420.91.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 8 white candles and 2 black candles for a net of 6 white candles. During the past 50 bars, there have been 27 white candles and 23 black candles for a net of 4 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 93.1693. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 11 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 85.88. 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 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 159.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 11 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 18 period(s) ago.
Rex Takasugi – TD Profile
PREC.M.XAU= closed down -0.860 at 1,418.300. Volume was 8,900% above average (trending) and Bollinger Bands were 171% 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: 1,368.56 1,305.86 1,273.67
Volatility: 13 12 11
Volume: 21 4 1
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 11.4% above its 200-period moving average and is in an upward 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 bullish on XAU= and have had this outlook for the last 30 periods. Our momentum oscillator is currently indicating that XAU= is currently in an overbought condition.