Gold 1 OZ (XAU=X) gains on Yemen attacks

Gold 1 OZ (XAU=X) gains on Yemen attacks

Gold 1 OZ (XAU=X) gains on Yemen attacks

Gold prices rose to their highest in more than a week on Monday, after a missile attack in Yemen over the weekend fanned geopolitical concerns and boosted the metal’s safe-haven appeal, while buying ahead of the Chinese New Year also lent support.

Spot gold was up 0.3% at $1,560.89 per ounce by 0726 GMT, after touching its highest since Jan. 10 at $1,562.51 earlier in the session. U.S. gold futures were flat at $1,560.50.

The market is also going up because of central bank buying, geopolitical risks such as Yemen missile attack – all these factors are supporting gold.

Iran-aligned Houthis attacked a military training camp in the Yemeni city of Marib on Saturday, killing dozens of people.

Gold is considered a safe investment in times of political and economic uncertainty.

“Investors are clearly focused on the longer term dynamics, which should play in gold’s favour with low interest environment, central banks’ loosening policy to help support growth and subsequent weakness in the dollar,” ANZ analyst Daniel Hynes said.

The U.S. Federal Reserve will meet for its first policy meeting of the year later this month, where it is widely expected to keep interest rates unchanged. 

The central bank cut interest rates three times last year before deciding in December to stand pat. Lower interest rates encourage the buying of non-interest-paying bullion.

However, limiting gold’s advance, Asian stocks held close to a 20-month high, supported by an extended rally in global stocks on Wall Street and solid U.S. economic data.

U.S. homebuilding surged to a 13-year high last month as activity increased across the board, while production at factories increased for a second straight month, data showed on Friday.

Trading volumes were low with U.S. markets closed for a holiday. 

Technical Indicators

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 1,514.37.

The projected upper bound is: 1,589.43.

The projected lower bound is: 1,542.83.

The projected closing price is: 1,566.13.

Candlesticks

A white body occurred (because prices closed higher 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 31 white candles and 18 black candles for a net of 13 white 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 80.2324. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a buy 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 67.85. 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 5 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 58. This is not a topping or bottoming area. The last signal was a sell 7 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 3 period(s) ago.

Rex Takasugi – TD Profile

PREC.M.XAU= closed up 7.735 at 1,563.960. Volume was 8,900% above average (trending) and Bollinger Bands were 53% wider than normal.

Open     High      Low     Close     Volume___
1,558.2601,563.9601,556.0501,563.960 67,860
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 1,556.67 1,496.71 1,438.46
Volatility: 12 10 14
Volume: 6,786 1,357 339

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 8.7% above its 200-period moving average and is in an upward trend. Volatility is 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 25 periods.

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