Instrument: GOLD
Bullish Preference:
Buy position is envisaged if price trades above 1923.69 With take profit at 1925.33
Bearish Preference:
Sell position is envisaged if price trades below 1917.17 with Take profit at 1915.45
Fundamentals:
1:30 PM USD: Unemployment Claims
Comment:
The yellow metal rebounded mid-August from quite strong support on the 200-day moving average and the June low of 1890. See “Gold, Silver Forecast: It’s Now or Never for XAU/USD, XAG/USD,” published August 13. This was associated with a brief reprieve lower in US real yields, also as data released in the second half of August failed to match up with overly optimistic expectations (the US Economic Surprise Index hit a two-year high at the end of July before cooling off).
On technical charts, after a brief rebound from strong converged support in late August, gold has retreated from vital resistance on the upper edge of the Ichimoku cloud on the daily charts and the 89-day moving average. The recent turn lower has raised the odds of a lower-highs-lower-lows sequence since May. For this bearish pattern to reverse, the yellow metal would need to, at minimum, rise above last week’s high of 1952. In turn, for a rebound to occur gold needs to hold the crucial support on the lower edge of the Ichimoku cloud on the 240-minute chart that it is now testing.
Analysis: SCRUM Team