Gold prices slipped in early trade in the domestic futures market on October 28 tracking trends of the international markets.
Gold prices eased in international markets after the dollar gained some strength against its peers as the hopes of US stimulus weakened after the US President said a deal is possible after the November election.
Trump on Tuesday said a coronavirus economic relief deal would likely come after the November 3 election, with the White House unable to bridge differences with fellow Republicans in the US Senate as well as congressional Democrats.
Weighing on gold is uncertainty about US stimulus and recovery in the US dollar index from recent lows.
However, supporting price is ETF inflows, rise in Chinese imports, and safe-haven buying amid rising virus cases and mixed economic data from major economies.
Gold may remain choppy as equities and the US dollar are likely to trade mixed ahead of US elections however general bias may be on the upside on the back of safe-haven buying amid rising virus cases and uneven recovery.
Overall, the bias in prices is: Downwards.
By the way, prices are vulnerable to a correction towards 1,897.73.
The projected upper bound is: 1,928.67.
The projected lower bound is: 1,825.69.
The projected closing price is: 1,877.18.
A big black candle occurred. This is bearish, as prices closed significantly lower than they opened. If the candle appears when prices are “high,” it may be the first sign of a top. If it occurs when prices are confronting an overhead resistance area (e.g., a moving average, trendline, or price resistance level), the long black candle adds credibility to the resistance. Similarly, if the candle appears as prices break below a support area, the long black candle confirms the failure of the support area.
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.
An engulfing bearish line occurred (where a black candle’s real body completely contains the previous white candle’s real body). The engulfing bearish pattern is bearish during an uptrend. It then signifies that the momentum may be shifting from the bulls to the bears.
If the engulfing bearish pattern occurs during a downtrend (which appears to be the case with PREC.M.XAU=), it may be a last engulfing bottom which indicates a bullish reversal. The test to see if this is the case is if the next candle closes above the bottom the current (black) candle’s real body.
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 26.8998. This is not an overbought or oversold reading. The last signal was a sell 16 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 42.22. 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 56 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 -190.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 4 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 sell 0 period(s) ago.
Rex Takasugi – TD Profile
PREC.M.XAU= closed down -28.620 at 1,878.210. Volume was 8,900% above average (trending) and Bollinger Bands were 62% narrower than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 1,903.35 1,918.37 1,767.05
Volatility: 13 17 23
Volume: 8,172 1,634 409
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 6.3% above its 200-period moving average and is in an upward trend. Volatility is relatively normal 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 bullish on XAU= and have had this outlook for the last 3 periods.
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