Gold 1 OZ (XAU=X) breakdown territory

Gold 1 OZ (XAU=X) breakdown territory

Gold 1 OZ (XAU=X) breakdown territory

The Fed spoke and the metals got hammered. After being flat most of Wednesday and then attempting to rally in front of the Fed announcement, gold and silver got hammered after the announcement.

In their own special way, the academic Fed decided to leave rates unchanged, which was no surprise except to those who were expecting a possible rate cut. After 3.2% GDP growth and an ADP number of 275,000 new jobs, the Fed remained clueless and dovish.

Gold and silver hated the news as both got clobbered afterward, putting both in breakdown territory. The action was ugly. Gold closed below the key level of $1,280 and now has its last chance to hold at $1,265. If gold fails to hold here, $1,220 to $1,240 comes into play. Our expectations are simple; the metals look ugly and are breaking down. We hold a positive view for the year but for now rallies will probably fail.

Overall, the bias in prices is: Downwards.

By the way, prices are vulnerable to a correction towards 1,288.13.

The projected upper bound is: 1,291.47.

The projected lower bound is: 1,248.41.

The projected closing price is: 1,269.94.


A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 23 white candles and 27 black candles for a net of 4 black candles.

Momentum Indicators

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.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 41.0747. This is not an overbought or oversold reading. The last signal was a buy 7 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 38.84. 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 49 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 -104.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -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 -5.070 at 1,271.285. Volume was 8,900% above average (trending) and Bollinger Bands were 16% narrower than normal.

Open High Low Close Volume___
1,276.5601,277.9301,265.8501,271.285 18,631

Technical Outlook
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 1,277.01 1,296.06 1,252.27
Volatility: 7 11 11
Volume: 1,863 373 93

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 1.5% above its 200-period moving average and is in an downward trend. Volatility is low as compared to the average volatility over the last 10 periods. 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 24 periods. The security price has set a new 14-period low while our momentum oscillator has not. This is a bullish divergence.

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