Gold 1 OZ (XAU=X) Prices Resume Downward March
Spot gold prices shook off a mild move to the upside and turned sharply lower again on Thursday in another day of extreme volatility.
Gold prices were down $41.30 or 2.53 percent to $1,593.50 after peaking at $1,646.40 and sinking as low as $1,560.60.
Comments from U.S. President Donald Trump drove the precious metal lower after he announced a travel ban from most of Europe to the United States for 30 days, intensifying investor fears about the economic fallout from the coronavirus.
Trump’s address on the coronavirus also failed to quell concerns about the economic impact of the outbreak.
The World Health Organization (WHO) has declared the coronavirus as a global pandemic after the virus spread to 114 countries, resulting in the deaths of more than 4,500 people worldwide.
Overall, the bias in prices is: Sideways.
By the way, prices are vulnerable to a correction towards 1,572.94.
The projected upper bound is: 1,625.77.
The projected lower bound is: 1,511.28.
The projected closing price is: 1,568.53.
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 3 white candles and 7 black candles for a net of 4 black candles. During the past 50 bars, there have been 29 white candles and 21 black candles for a net of 8 white candles.
Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.
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 9.4281. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 2 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 40.67. 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 12 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 -148.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 2 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 -66.775 at 1,567.750. Volume was 8,900% above average (trending) and Bollinger Bands were 78% wider than normal.
Open High Low Close Volume___
Short Term: Oversold
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 1,632.52 1,589.28 1,497.86
Volatility: 41 23 17
Volume: 6,705 1,341 335
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 4.7% above its 200-period moving average and is in an upward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. 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 16 periods.
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