Whilst a lot of focus was on the diagonal support structures for gold, including a bottom at $1240, I prefer this more technical explanation.
The price has basically completed 3 drives down:
1) 1370 (top) to 1303
retrace to 61.8% line at 1328
2) 1328 to 1284 (1.272% extension)
retrace to 78.6% line at 1317
3) 1317 to 1261 (161.8% extension) =...
Red triangle held in both directions - first a false break high and then a major bull capitulation which was held at the bottom. The price is now back at the monthly pivot and within the blue parallel channels (coiled area) on my chart. Am initially looking for a move to the top of the blue parallels and then subject to it breaking the top of the red triangle and beyond.
Broken symmetrical triangle &a retested breakout area.
Powerfully sat at the pivot level now with all R levels visible within trading range on a near term basis IMO.
Company released good news re project & more to come.
This looks like it has broken out of the cycle low & then successfully backtested the breakout. RSI, sentiment all support the low being correctly identified. This looks like a good opportunity to sit on a long move upward.
Remains close to 2yr support & extreme Bearish positioning which suggests this is the low/bounce area. Would continue to buy weakness OR buy into the rise if it continues above the pivot area in orange (1.343).
Failure on Friday to move much lower than $1290 and certainly not even challenge the trending support despite the NFP data tells us the bottom is truely in. I think this is now an accumulation zone whilst we await FOMC later in the month. Will slowly trend up until then.
Very narrow range getting increasingly narrow. Extreme move coming.
I'm looking at GOLD and Dollar for the clues & probably FOMC is the catalyst but Silver might be the trade to play rather than the other two.
4hr chart shows resistance at the R3 level which is also the same as the weekly pivot level on the daily chart & looks to have run out of steam here. RSI has also put in a divergence. Unless this moves immediately higher on Monday I would look for a short towards the R1 level at $2.675 (also the 200 MA is here).
This index has now corrected 5% and on the daily chart the RSI has floored. The price closed the week bank on the 34EMA which has been a broad area of support.
Interestingly and what this chart shows is that the fall has closed a major gap at 25576 but we now have a huge gap from the start of this drop back up to 26435.
BTFD still the underlying mentality?
Like EURUSD this is overbullish and over extended. With strength in the DXY we should see this pair take a breather. At the very least, this should pull back to form a flag shape for move higher with a target in the 140 area.