Gold 1 OZ (XAU=X) still in a four-week-old uptrend

Gold 1 OZ (XAU=X) still in a four-week-old uptrend

Gold 1 OZ (XAU=X) still in a four-week-old uptrend

Technically, gold bulls still have the overall near-term technical advantage. Prices are still in a four-week-old uptrend on the daily bar chart, but just barely. Bulls’ next upside price objective is to produce a close in February futures above solid resistance at the December high of $1,256.60.

Bears’ next near-term downside price breakout objective is pushing prices below solid technical support at $1,220.00. First resistance is seen at Friday’s high of $1,247.30 and then at $1,250.00. First support is seen at the overnight low of $1,239.40 and then at last week’s low of $1,236.50.

Overall, the bias in prices is: Upwards

By the way, prices are vulnerable to a correction towards 1,228.42.

The projected upper bound is: 1,269.11.

The projected lower bound is: 1,226.32.

The projected closing price is: 1,247.72.

Candlesticks

A big white candle occurred. This is generally considered bullish, as prices closed significantly higher than they opened. If the candle appears when prices are “low,” it may be the first sign of a bottom. If it occurs when prices are rebounding off of a support area (e.g., a moving average, trendline, or retracement level), the long white candle adds credibility to the support. Similarly, if the candle appears during a breakout above a resistance area, the long white candle adds credibility to the breakout.
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 25 white candles and 25 black candles.

An engulfing bullish line occurred (where a white candle’s real body completely contains the previous black candle’s real body). The engulfing bullish pattern is bullish during a downtrend. It then signifies that the momentum may be shifting from the bears to the bulls.

If the engulfing bullish pattern occurs during an uptrend (which appears to be the case with PREC.M.XAU=), it may be a last engulfing top which indicates a top. The test to see if this is the case is if the next candle closes below the top of the current (white) candle’s real body.

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 50.9438. This is not an overbought or oversold reading. The last signal was a sell 4 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 62.34. 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 buy 86 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 63. This is not a topping or bottoming area. 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 10 period(s) ago.

Rex Takasugi – TD Profile

PREC.M.XAU= closed up 8.420 at 1,246.540. Volume was 8,900% above average (trending) and Bollinger Bands were 2% wider than normal.

Open High Low Close Volume___
1,237.1501,248.0801,235.3701,246.540 13,916

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

Moving Averages: 10-period 50-period 200-period
Close: 1,242.04 1,225.36 1,253.31
Volatility: 8 11 12
Volume: 1,392 278 70

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 0.5% below its 200-period moving average and is in an upward trend. Volatility is low 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 7 periods.

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