Gold 1 OZ (XAU=X) Markets Show Strength

Gold 1 OZ (XAU=X) Markets  Show Strength

Gold 1 OZ (XAU=X) Markets Show Strength

Gold markets have initially pulled back a bit during the trading session on Thursday but found enough support just above the $1600 level to turn around and go higher. There are plenty of concerns around the world when it comes to growth, and that of course helps gold. Beyond that, the concerns about growth continue to have people throwing money at gold from their local currencies. The fact that the market has broken above the $1600 level is a good sign as well, so at this point I think the market is going to try to run towards the $1800 level.

To the downside, not only is the $1600 level supportive, but the $1550 level should be as well, especially with the 50 day EMA crossing it right now. All things being equal, the market looks as if it wants to go higher given enough time, so I do like the idea of looking at dips as value and adding to an already larger core position. Granted, the gold markets will move based upon headlines, especially when it comes out of China, but given enough time central banks loosening monetary policy is the greatest determination of where this market goes next.

This is a market that has been forming an ascending triangle, which we have just broken out of. Given enough time, it means that we could go looking toward $1700 level in the short term, but based upon the longer-term consensus and technical analysis, the $1800 level makes quite a bit of sense.

Technical Indicators

Overall, the bias in prices is: Upwards.

Note: this chart shows extraordinary price action to the upside.

The projected upper bound is: 1,649.98.

The projected lower bound is: 1,594.44.

The projected closing price is: 1,622.21.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 33 white candles and 16 black candles for a net of 17 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 93.7014. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 17 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 71.45. This is where it usually tops. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 17 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 185.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 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 buy 2 period(s) ago.

Rex Takasugi – TD Profile

PREC.M.XAU= closed up 7.865 at 1,619.210. Volume was 8,900% above average (trending) and Bollinger Bands were 13% wider than normal.

Open     High      Low     Close     Volume___
1,611.4171,623.4511,603.6001,619.210 43
Technical Outlook 
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 1,584.80 1,547.21 1,472.24
Volatility: 9 11 15
Volume: 4 1 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 10.0% above its 200-period moving average and is in an upward 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 bullish on XAU= and have had this outlook for the last 1 periods. Our momentum oscillator is currently indicating that XAU= is currently in an overbought condition.

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