#202435 - priceactiontds - weekly update
Good Evening and I hope you are well.
tl;dr
gold: Bulls bought the first pullback and I expect bears to try again. Market went sideways which shows strength by the bulls to keep it above 2500. Next week will be important because so far the highest monthly close was 2472 and a monthly close above 2500 would confirm the breakout again. Bears need consecutive bear bars below 2500 and bulls a daily close above 2550. Neutral going into next week.
Quote from last week:
comment: Did we learn anything from a sideways week? We have a bullish pattern and a technical textbook pullback a bit above the ema. Bulls bought it and that is bullish. But only a break above 2570 is confirmation. Resistance is always that until it breaks, no matter how strong you think the trend is/looks/feels and this trend inside a 5 month trading range is not strong so far. Bulls are trying the breakout and the monthly close will be the most important for them. If they manage their first close above 2500, it would be a confirmation and buy signal going into September. What could be a potential target above? Since the trading range was mostly between 2300 - 2500ish, we can do a measured move up and that would bring us to the ballpark around 2700.
current market cycle: trading range for many months now and it’s probably coming to an end over the next weeks/months —unchanged
key levels: 2400 - 2550
bull case: Bulls raised their odds of this breakout being real last week. Next week is their do or die moment for this. It’s either break above 2550 and get a daily close above or fail again and trade back down to the lower bull wedge or even 2300. I do think 2540-2570 is a dead zone for trading long. If we get near 2520-2530 I consider buying but not above. Odds currently favor the bulls slightly.
Invalidation is below 2500.
bear case: Nothing changed for the bears. Either stop the bulls below 2570 or give up for 2600 and potentially 2700 over the next weeks. Bears need a 1h close below 2500 badly. That’s it. If you are short Gold right now, don’t come to me hoping for bear porn. I’m long past that phase in Gold. Do I still think this is overvalued and can crash below 2000 again? Bet. Will this save your underwater shorts? Hell naw. Get out now or latest at 2571.
Invalidation is above 2571.
outlook last week:
→ Last Sunday we traded 2537 and now we are at 2546. Bulls got above 2550 but big rejections only. Neutral outlook was perfect since we closed 9 points above last week.
short term: Exactly the same as last week. Bears had a pullback and bulls bought it. Inherently bullish but only if bulls can break above 2570.
Neutral until bears come around or strong break above 2570. If bears build good selling pressure, I want a retest of 2500 first and lower i look for 2470.
medium-long term: For now I think the most reasonable outlook I could give is a trading range 2200-2500. This could hold for some time. Bear in my still thinks this rally is moronic and we will see 2000 again this year but that’s as unreasonable of an outlook one could hold so don’t. —unchanged since May
current swing trade: None.
chart update: Added bull wedge trend line and measured move target #1.
tl;dr
gold: Bulls bought the first pullback and I expect bears to try again. Market went sideways which shows strength by the bulls to keep it above 2500. Next week will be important because so far the highest monthly close was 2472 and a monthly close above 2500 would confirm the breakout again. Bears need consecutive bear bars below 2500 and bulls a daily close above 2550. Neutral going into next week.
Quote from last week:
comment: Bulls got a new ath but the highest monthly close so far was 2473 and there is no reason to expect a huge breakout above 2550 with follow through. If it happens, hopp along but odds favor the bears for another reversal like so many times in the last 4 months. No matter how you interpret the patterns on the chart, all favor a reversal and betting on a breakout after 4 months of trading range price action is a losing strategy in the long run. I am neutral and wait for bears to show strength but will join the bulls on a strong breakout above 2550.
comment: Did we learn anything from a sideways week? We have a bullish pattern and a technical textbook pullback a bit above the ema. Bulls bought it and that is bullish. But only a break above 2570 is confirmation. Resistance is always that until it breaks, no matter how strong you think the trend is/looks/feels and this trend inside a 5 month trading range is not strong so far. Bulls are trying the breakout and the monthly close will be the most important for them. If they manage their first close above 2500, it would be a confirmation and buy signal going into September. What could be a potential target above? Since the trading range was mostly between 2300 - 2500ish, we can do a measured move up and that would bring us to the ballpark around 2700.
current market cycle: trading range for many months now and it’s probably coming to an end over the next weeks/months —unchanged
key levels: 2400 - 2550
bull case: Bulls raised their odds of this breakout being real last week. Next week is their do or die moment for this. It’s either break above 2550 and get a daily close above or fail again and trade back down to the lower bull wedge or even 2300. I do think 2540-2570 is a dead zone for trading long. If we get near 2520-2530 I consider buying but not above. Odds currently favor the bulls slightly.
Invalidation is below 2500.
bear case: Nothing changed for the bears. Either stop the bulls below 2570 or give up for 2600 and potentially 2700 over the next weeks. Bears need a 1h close below 2500 badly. That’s it. If you are short Gold right now, don’t come to me hoping for bear porn. I’m long past that phase in Gold. Do I still think this is overvalued and can crash below 2000 again? Bet. Will this save your underwater shorts? Hell naw. Get out now or latest at 2571.
Invalidation is above 2571.
outlook last week:
short term: Neutral until bears come around or strong break above 2550. If bears build good selling pressure, I want a retest of 2500 first and lower i look for 2470.
→ Last Sunday we traded 2537 and now we are at 2546. Bulls got above 2550 but big rejections only. Neutral outlook was perfect since we closed 9 points above last week.
short term: Exactly the same as last week. Bears had a pullback and bulls bought it. Inherently bullish but only if bulls can break above 2570.
Neutral until bears come around or strong break above 2570. If bears build good selling pressure, I want a retest of 2500 first and lower i look for 2470.
medium-long term: For now I think the most reasonable outlook I could give is a trading range 2200-2500. This could hold for some time. Bear in my still thinks this rally is moronic and we will see 2000 again this year but that’s as unreasonable of an outlook one could hold so don’t. —unchanged since May
current swing trade: None.
chart update: Added bull wedge trend line and measured move target #1.
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