Although gold’s near-term fortunes lie in the hands of the Federal Reserve, one commodity analyst says that the market is building significant upside momentum.
In a report Wednesday, ahead of the Fed’s monetary policy decision, Ole Hansen, head of commodity strategy at Saxo Bank, said that the imminent rate hike — the seventh in the current cycle — has sapped investor interest and demand from the gold market.
However, he added that with sentiment at such lows, the probability of higher prices has increased. Hansen’s comments come as gold continue to hover around the critical psychological level of $1,300 an ounce.
The key levels to look out for has remained the same for some time now: a sustained break below $1,286/oz would call into question the rally from the December low while a move above $1,308/oz, the 200-day moving average, is likely to attract renewed technical and momentum buying from funds currently underweight in gold.
Overall, the bias in prices is: Sideways.
The projected upper bound is: 1,318.55.
The projected lower bound is: 1,278.72.
The projected closing price is: 1,298.64.
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 27 white candles and 23 black candles for a net of 4 white candles.
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 58.3596. This is not an overbought or oversold reading. The last signal was a buy 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 47.68. 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 98 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 -6. This is not a topping or bottoming area. The last signal was a buy 16 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 buy 13 period(s) ago.
Rex Takasugi – TD Profile
PREC.M.XAU= closed up 3.740 at 1,299.310. Volume was 8,900% above average (trending) and Bollinger Bands were 64% narrower than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 1,296.33 1,312.97 1,306.81
Volatility: 4 10 12
Volume: 1,769 354 88
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 0.6% below its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. 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 2 periods. Our momentum oscillator has set a new 14-period high while the security price has not. This is a bullish divergence.
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