Gold 1 OZ (XAU=X) found itself on the chopping block

Gold 1 OZ (XAU=X) found itself on the chopping block

Gold 1 OZ (XAU=X) found itself on the chopping block

 As financial markets around the world cratered this week, gold wasn’t much of a safe haven.

While prices briefly flirted with $1,700 an ounce on Monday, selling pressure from every corner of the market spread to bullion too. In the rush to raise cash, investors pulled money out of gold and the stronger dollar made the metal less appealing.

Prices have fallen 4.8% this week, the biggest decline since 2016. On Friday, they added 1.1% to $1,594.02 an ounce as of 12:55 p.m. in London.

Still, despite this week’s sell-off, the mood in the gold market is strongly bullish. Almost everyone is expecting prices will slowly climb higher if the coronavirus causes a recession in the global economy.

“Gold looks a pretty good bet over the medium term,” Daniel Hynes, senior commodity strategist at Australia & New Zealand Banking Group Ltd. said in a Bloomberg TV interview. “You could even call a 10% to 15% rally a fairly good possibility in the shorter term.”

Technical Indicators

Overall, the bias in prices is: Downwards.

The projected upper bound is: 1,587.11.

The projected lower bound is: 1,470.63.

The projected closing price is: 1,528.87.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 3 white candles and 7 black candles for a net of 4 black candles. During the past 50 bars, there have been 28 white candles and 22 black candles for a net of 6 white candles.

Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.

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 10.0935. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 3 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 35.19. 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 13 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 -205.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 3 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 1 period(s) ago.

Rex Takasugi – TD Profile

PREC.M.XAU= closed down -47.475 at 1,529.310. Volume was -0% below average (neutral) and Bollinger Bands were 101% wider than normal.

Open     High      Low     Close     Volume___
1,576.4501,597.3351,506.3501,529.310 0
Technical Outlook 
Short Term: Oversold
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 1,627.88 1,589.02 1,498.85
Volatility: 38 23 18
Volume: 0 0 0

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.

Summary

PREC.M.XAU= is currently 2.0% 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 17 periods.

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