Gold 1 OZ (XAU=X) higher as investors respond to a slightly weaker U.S. Dollar

Gold 1 OZ (XAU=X) higher as investors respond to a slightly weaker U.S. Dollar

Gold 1 OZ (XAU=X) higher as investors respond to a slightly weaker U.S. Dollar

Gold futures are trading marginally higher on Monday as investors respond to a slightly weaker U.S. Dollar. Volume is low, however, as many major players are taking to the sidelines ahead of the start of the Fed’s two-day meeting which begins on Tuesday. Helping to pressure the U.S. Dollar, and increase demand for dollar-denominated gold is another dip in U.S. Treasury yields.

This week, gold traders will continue to watch heightened geopolitical uncertainties including Brexit. This week, British Prime Minister Theresa May’s government will be trying to gather support in parliament for her Brexit deal. This will be May’s third attempt to get her exit plan approved. On March 29, the UK is expected to leave the European Union without an exit plan in place. In addition to May’s plan, some Members of Parliament (MP) are trying to get an extension from the EU.

The Fed’s interest rate and monetary policy decisions on Wednesday as well as the Federal Open Market Committee’s new economic projections will probably exert the most influence on gold prices this week.

Gold traders are nervous because the Fed could back away somewhat from its dovish stance and take a more balanced approach toward future rate hikes. This move would be bullish for the dollar and bearish for gold.

However, central bank policymakers could turn slightly more dovish, which would be supportive for gold prices.

Given the two possibilities and in the absence of any major market moving events, look for a rangebound trade today as investors are likely to refrain from taking any major positions ahead of the Fed announcements on Wednesday.

Overall, the bias in prices is: Upwards.

The projected upper bound is: 1,328.34.

The projected lower bound is: 1,283.24.

The projected closing price is: 1,305.79.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 27 white candles and 23 black candles for a net of 4 white candles.

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 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 60.5759. This is not an overbought or oversold reading. 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 51.14. 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 18 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 72. This is not a topping or bottoming area. The last signal was a buy 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 buy 2 period(s) ago.

Rex Takasugi – TD Profile

PREC.M.XAU= closed up 1.930 at 1,305.380. Volume was 8,900% above average (trending) and Bollinger Bands were 29% wider than normal.

Open High Low Close Volume___
1,303.2001,307.7611,302.2001,305.380 7,626

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

Moving Averages: 10-period 50-period 200-period
Close: 1,298.06 1,304.48 1,246.72
Volatility: 10 11 11
Volume: 763 153 38

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 4.7% above its 200-period moving average and is in an downward trend. Volatility is high 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 bearish on XAU= and have had this outlook for the last 11 periods.

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