FX_IDC:XAUUSD   Gold Spot / U.S. Dollar
Hi Traders,

We have broken structure of accumulation and have formed a SOS (sign of strength) as well as strong LPS (last point of supply) at 1800-1795.

Based off the cause and effect of the accumulation, the calculation using the PnF chart as seen below gives us a target area of 1920 - 1955.


We have had high volume sells and low volume buys however have continued an upward trend and made new highs and higher lows with a strong demand curve/line formed from the low of the spring . This fact along with Gold moving in the same direction as the DXY shows its strength over USD and possibilities for a rally upwards.

Fundamentals also agree with the buying of gold due to Basel III policy - https://www.marketwatch.com/story/why-ba... Covid 19 Delta tensions - https://www.cbsnews.com/news/covid-vacci... and news just released with Biden and Putin tensions over ransomware Russian hackers.

This is not taking into consideration the potential tapering talks and increased inflation possible in the near future.

Commitment of Traders shows the following of Non-Commercial Traders:

Dated: 07/06/2021

Long: 270,545 Short: 87,724
Change: 16,339 Change: (4,256)

This means institutions have opened more long positions and have closed short positions with a much higher percentage of longs than shorts.

Bank participation still shows 34.5% as short and 11.3% as long, however, this changed in the recent in favour of longs with long being increase by 1.1% and shorts by 0.5% - https://www.cftc.gov/MarketReports/BankP...

A potential entry could be:

Entry: Between 1800 - 1815
Stop Loss: Below 1790
Take Profit 1: 1860
Take Profit 2: 1920
Take Profit 3: 1955

This would be roughly a 1:7 R:R.

This is not financial advice
Trade with caution


Trade active: As ANKTRADER has mentioned we could also see a sharp decline, especially following CPI data. I personally don't see us breaking 1750, however, if this is the case 41 - 33 and 22 will need to be watched closely.

Comments

1H, 4H charts are giving sharp bearish divergence...
I Guess it might get go down very sharply.
+1 Reply
@ANKTRADER, Yes I noticed this too, indicators can be miss-leading in a trending market though. However, I have not ruled a drop below 1795 to around 1750-60 and a touch of May '19 trend line out. Below that an extension of wave 5 to 1722 which will be bank level. 1800 - 1796 will be the key area to watch as well as 1812-1815.
Reply
nice job

We also have analyzed Gold like you, whenever you have some free time check it out on our page.
Our first TP is 1990

thank you for sharing nice data
+1 Reply
Thank you for sharing your analysis.
+1 Reply