Gold 1 OZ (XAU=X) traders buying on the dip
Gold prices are slightly higher in early U.S. trading, on some short covering in the futures market and some perceived bargain hunting in the cash market. The metals are also supported as the U.S. dollar index has turned weaker despite an upbeat U.S. jobs report that was just released. June gold futures were last up $0.40 an ounce at $1,294.70. May Comex silver was last up $0.061 at $15.15 an ounce.
Technically, the gold bulls still have the overall near-term technical advantage but have faded recently and need to show fresh power soon. Traders are eyeing a bearish head-and-shoulders top reversal pattern on the daily bar chart that has formed the past couple months. This week’s price action did see a move below the “neckline” of the formation, which is a bearish chart signal.
Bulls’ next upside price objective is to produce a close in June futures above solid resistance at the March high of $1,330.80. Bears’ next near-term downside price breakout objective is pushing prices below solid technical support at the March low of $1,287.50. First resistance is seen at this week’s high of $1,301.70 and then at $1,305.00. First support is seen at this week’s low of $1,284.90 and then at $1,280.00.
Overall, the bias in prices is: Sideways.
By the way, prices are vulnerable to a correction towards 1,292.29.
The projected upper bound is: 1,313.01.
The projected lower bound is: 1,269.12.
The projected closing price is: 1,291.06.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 27 white candles and 23 black candles for a net of 4 white candles.
A long lower shadow occurred. This is typically a bullish signal (particularly when it occurs near a low price level, at a support level, or when the security is oversold).
A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.
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 43.3218. This is not an overbought or oversold reading. The last signal was a buy 1 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 43.45. 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 31 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 -77. This is not a topping or bottoming area. The last signal was a buy 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 5 period(s) ago.
Rex Takasugi – TD Profile
PREC.M.XAU= closed down -0.825 at 1,291.300. Volume was -0% below average (neutral) and Bollinger Bands were 21% narrower than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 1,298.20 1,307.96 1,248.54
Volatility: 11 11 11
Volume: 0 0 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.
PREC.M.XAU= is currently 3.4% above its 200-period moving average and is in an downward 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 bearish on XAU= and have had this outlook for the last 6 periods.