Gold technical update

Dear readers,

This week the August gold contracts (GCQ8, ZGQ8, YGQ8) traded between ~913$ and ~859$ (54$ range). The price did go below 868$ - 864$ but closed the week at ~873$.

For August gold the important low is ~850$ and if that cant hold then there is major support between 835$ and 770$ ( spot gold price). Spot gold 65 weekly moving average currently around 786$.



Resistance zones for GCQ8 : ~895$, ~913$, ~940$, ( 964$ - 968$ ) and 1040$.


GCQ8 480 minutes chart annotated with short term relevant Fibonacci levels.





Spot gold linear weekly chart with Fibonacci levels.

August Gold (GCQ8) & Spot Silver (XAGUSD) update

Dear readers,

This last week we have probably seen a successful retest of the low of 864$ and currently gold is trying to move higher towards resistance zone at ~940$.


Support zones for the GCQ8 contract : ~868$, ~864$, ~850$ and Fibonacci levels.

Resistance zones for GCQ8 : ~940$, ~960$, ~964$, ~1040$ and Fibonacci levels.


GCQ8 August gold contract - 8 hours linear Fibonacci chart




Silver has been consolidating and have first support at the 15.96$ – 16.40$ zone and resistance at the 18.33$ – 18.72$ zone. (spot silver prices)


XAG/USD - silver spot daily chart

August Gold (GCQ8)

Currently the Comex August 100 oz gold future is the most active contract (GCQ8) , open interest for this contract is 257,894 according to NYMEX website.

GCQ7 topped at 03/17/2008 @ 1039.8$ and recently bottomed at 05/02/2008 @850.5$. The trading range this year was ~190$ so far.


Since the 05/02/2008 bottom gold managed to climb ~90$ but then pulled back and lost most of the gain.

Support zones for the GCQ8 contract : ~871$, ~864$, ~850$.

Resistance zones for GCQ8 : ~940$, ~960$, ~964$, ~1040$.



Once this ~190$ trading range is violated refer to the logarithmic weekly gold spot chart below for potential targets and support resistance zones.


GCQ8 August gold contract - 8 hours linear Fibonacci chart




XAU/USD - gold spot weekly log Fibonacci chart

Gold price short term update

Dear readers,

Gold have managed to break and close above the diagonal trend line resistance. Gold is currently trying to rally higher , there is significant resistance zones all the way up to the top at 1038$ (GCM8) , so new highs are not likely any time soon. What is likely is a prolonged consolidation period similar to the price action that took place between mid 2006 and mid 2007.

The price of gold might have to base around till the 65 weekly moving average will be near.

Short term resistance and support zones as well as Fibonacci levels are outlined on the 8 hours gold futures candle chart below .




The longer term linear weekly bar chart annotated with the 65 moving average ( spot gold 65 MA)






The relevant post Nixon gold "Fix" monthly chart (1971 - 2008)

Gold futures (GCM8) and silver (xagusd) technical update

Gold is down trending and aiming to break support at first April low (876.5$ for GCM8). The price of gold failed to penetrate the 50% Fibonacci resistance at 957.54 and selling pressure pushed the price lower.

Resistance at diagonal upper trend line, ~906.5$ , ~938$ (38.2%Fibonacci) , ~976$ (61.8% Fibonacci) , ~1003$(76.4% Fibonacci) and the high of 1038$.


Support at 876.5$ ,~860, 850$ -840$ , ~820$, 792$, ~750$.


June Comex gold futures (GCM8) 8 hours chart



Gold spot weekly chart






Silver is down trending as well and already lost 5$ from its top at 21.33$ (spot price)


Silver Spot weekly chart

Short term technical update (GCM8)

The bulls had a few moments of grace as the price of gold managed to trade above the diagonal trend line resistance, but gold failed to penetrate the secondary top at ~960$ and pulled back ~50$.

resistance around ~938$ (38.2% fibo) , ~976$ (61.8% fibo) , ~1003$(76.4% fib) and the high of 1038$.

support at ~888$, 876.5$ 850$ -840$ , ~820$, 792$.

All price relating to Comex gold June contract (GCM8)

Gold price short term analysis

Dear readers ,


General observation: In the last several weeks some actions took place, all of them in order to stabilize systematical large size financial risks. Major central banks such as the US Federal Reserve(Fed) and the ECB are keeping a closer eye on the markets, apparently being more flexible and “creative”.

The above has probably a negative continues influence on the affinity to physical gold as an insurance – proof to major systematical financial risks.


Technical condition
Spot chart - gold dropped below the uptrend line which connect the August and December bottoms (2007) but managed to climb back, currently it closed right on that line.




Gold June future contract (GCM8) 8 hours chart - Topped at 1038$ , bottomed at 876$. resistance - so far the 38.2% fib (938$) - , 950$ -960$ (50%) . The downtrend linear channel is still encapsulating the minor uptrend so the bear force has the control on that time frame.

Gold chart & update

The climate: Continued stress of banks and other financial institutions. In my opinion the source of this stress is illiquidity of non trade able (unlisted at a public exchange) financial “products”.

Outlook: High volatility is present in all markets, extreme events in which investment banks remove huge amounts of liquidity while central banks creates huge amount of liquidity to fill the “holes”.

Technical:

Recent pullback was the biggest since August 2007 bottom, the spot price of gold came down ~128$ (905$) since it's top at 1033$. The spot price of silver dropped from it's top at ~21.35 to ~16.67$.

The trend line which connect the August and November bottoms is still intact. See the chart below for Fibonacci proportions and less steep trend lines. If the recent bottom zone at 905$ - 884$ will not hold then the price might retrace to about 790$ if not lower.

Later on and depending on the fundamental events which will be reflected on the charts – gold might move higher or maybe much higher then recent highs.

XAUUSD, XAGUSD Charts

Significant corrections are taking place for both gold and silver. So far this is the sharpest drop seen since the mid august bottom. Each Fib line is currently a possible downside target.

Personally, I observe that at the moment some other markets offer superior short term trading opportunities.


Silver (Spot price) 8 hours chart


Gold (Spot price) 8 hours chart

GCQ7 Update

Dear readers,

This will probably be the last GCQ7 chart as gold futures contracts are rolled into December and October (GCV7, GCZ7).

Hype is all over the place so sentiment indicator probably supports the case for some correction here, As previously mentioned USD is trying to bounce.



August Gold - GCQ7 Intraday (120 min) Chart

Gold, USD & Forex Update

Dear readers,

The USD is looking oversold here and some bounce might be expected. If you add a channel the way I did, you can see that the USD index is at the bottom of the channel. In addition, the USD just tested the psychological important 80 level – this level was rarely violated, ever.


USD Index Daily Chart (note the deep oversold condition of RSI 14)




































Try to avoid shorting the Yen as the crowed count this currency as a weak one. The interest rate on the yen is low and might continue to stay low for some time but the Japanese economy is not a weak economy in my book, not at all.

Particular vulnerable is the EURJPY pair which had already completed or might be very near to complete a seven years rally. A large correction is expected here – take note!

EURJPY Weekly Chart , Elliott wave count. (click to enlarge)





















Gold and silver had a nice rally (as expected) but some significant resistance seen for both. on the other hand gold in terms of Yen and Euro made some advance so the move was not all USD related. If the USD will start strengthening as it might gold can correct some of its recent 47$ rally. Corrections should be seen as a buying opportunity and the June low should hold.

Spot Gold weekly chart annotated with Fibonacci levels. (click to enlarge)

Gold and Silver Charts

Dear readers,



Yet again, minor consolidation might be over; gold and silver should be ready to move higher. Just my opinion, only the time will tell.



(SIU7) COMEX September Silver Intraday Chart (2 hours sticks)



















(ZGQ7) CBOT August Gold Intraday Chart (2 hours sticks)

GCQ7

Gold, Silver, Platinum & Palladium all up on the day.

Two hours sticks chart of COMEX August gold contract looking very similar to the COMEX September silver chart I posted two days ago.

XAGUSD Chart

Some initial upward movement for the price of gold and silver. Not surprising as buy signal was generated by the HUI/GOLD ratio. Silver outperformed and closed at the high for the week. A slight uptrend is apparent on the intraday chart. As you probably know all trend lines are made to be broken and the shorter the time frame the larger the chance that a trend line will be broken. Anyway, markets moves are not linear, markets moves in waves or more precisely fractal waves.

Spot Silver intraday 2 hours chart.

Silver

If enough cash based buying enters the physical silver market then regardless of the silver market fundamentals (which are supportive) the price will quickly rally. The move should be similar to the second half 2005<> first half 2006 in which silver climbed about 130% in 8 month. 12.30$ today is like 6.70$ in 2005 so the target is about 27.80$ which is between the short and long 261.8 Fibonacci levels.


Spot Silver {XAGUSD} Weekly Log Chart

And they tell you it is not a currency….

Today gold was clearly trading like a currency and no wonder that silver lagged. (The monetary component within silver certainly exist but for lesser extant compared to gold) Before the New York open gold was higher both in terms of Euro and USD then moved higher in USD and Lower in Euro, later the opposite: up in Euro down in USD, a sell off in both majors then a strong impulsive rally into the close.(Compare minutes XAUUSD with XAUEUR charts to notice that)


Added:

XAUUSD and XAUEUR 2 minutes chart






















The day to day action is trend less, the downside momentum is gone but some trend line resistance exists.

Gold continue to present a relatively rare opportunity in the global financial market place. An Item which is liquid, time lasting and provides insurance against systematical issues. In addition the possibility for significant price appreciation certainly exists. This is my opinion.


XAUUSD weekly log chart with Fibonacci price projections

Intraday Gold Chart

Dear readers,

Most assets rising in price today and the EUR/USD is higher, the price of gold is up. Positive liquidity which is oxygen for all assets markets appear yet again.

Technically: The price of gold managed to break above the sharp short term downtrend line. However, I opine that the last three candles on the daily chart are technically very bearish and that will have more implications going forward. The gold bears have spoken and showed forceful resistance.

ZGM7 – CBOT June Gold Intraday (120 minutes) chart below, annotated with Fibonacci lines and Elliott wave count

Drop & drop and drop...

Short term intraday turn up in the momentum indicators failed to materialize into rising gold prices. Gold then dropped like a rock below this month low.

A lower low after a lower high is technically bearish. Spot Gold is currently trading around the dreaded 666$ level.

The uptrend on the daily chart is still intact but might not hold.

Elliott wave cyclical point of view: I think we just witnessed a truncated v wave.

I'm not ready to get long term bearish here but more downside is certainly possible.

Spot Gold daily chart

Gold Charts

Technically there is not much change… The uptrend on the daily chart is intact.

COMEX June gold (GCM7) daily chart- the price is still between the 50 %( 672.50$) and the 61.8 %( 695.8$) Fibonacci levels.




















CBOT June gold (ZGM7) intraday (120 minutes) chart – the price recently bottomed at 670.1$ and again at 684.1$ today. Bottom to top and top to bottom short term Fibonacci levels are added.

Intraday Wave v underway but ...

Dear readers,

The gold market showed strength in the face of rising USD Index. This fact which probably surprised some traders - will be very useful at a later stage of this gold global bull market.

Technically, as the price of gold broke above the short term downtrend line the bottom was confirmed. Gold then spent some time back testing the downward slope line and then headed higher. Once gold managed to exceed the highs of the day (yesterday) a flood of market if touched (MIT) buy orders were all over the place and the price was quickly marked up.

GCM7 Gold June Comex Intraday (120 min) chart

























There is literally tons of resistance from here all the way to 700$. This is the intraday wave v and once completed a correction will be needed.


GCM7 June COMEX Gold daily chart


















To understand my technical work you must have knowledge of Elliott wave theory. You might want to check this online tutorial. For access you only need to be an Elliott wave international club member. If you can afford then order R. Precter book: How to Forecast Gold and Silver Using the Wave Principle.