Gold bears looking for a discount (Update 4)
Hi guys,
Another superbullish week with an excellent weekly close and gold looks in excellent form. We have the 7th straight green day in a row, with bull candles showing exhaustion near the weekly top Boilinger Band. This should be good enough for a 40-50 dollar retrace. This retrace is obviously a gift from the big guys for us little fish to catch the bull ride to 1920 with some possible slippage to 1930. From there we need to reassess the situation, as that level is a strong bearish zone.
I need to make note that we are still in a bearish trend until 1960 is taken out, creating a higher high on the daily chart since the bear-rally to 1680. Until then, this might just be a (strong) bullish retrace. It looks like a nice sell from a technical point of view as we are near the 0.272 fibo retracement level (1883) and near the 2020 closing price (1893), but this can only be confirmed after we see a strong bearish daily reversal pattern (usually preceded by a week of heavy ranging). If the bears manage to break through 1820 (breaking the bearflag), then for me the bullish trend has officially ended and we are looking at a bearish hostile take-over that can bring us all the way down to 1600.
For the time being, I remain bullish on gold and will be looking to buy dips on important fibo levels until proven otherwise. I will avoid buy limits, as the current H4 candle pattern reminds me of the pattern preceding the $115 big bear candle of November 9th 2020 (better be safe than sorry). Rather I will keep an eye on the chart to look for a bullish divergence on lower timeframes, bullish harmonics or bearish exhaustion near important support levels.
So far the dollar seems helpless and the weekly candle barely closed above 90. However, we have a triple bullish divergence on the daily there, and a bullish relief rally can't be ruled out. With the last triple divergence, the dollar travelled 4 points from 89 to 93. From a fundamental point of view, we had the FOMC minutes on Wednesday where tapering has been mentioned for the first time since the corona-crisis in 2020.
After Dallas FED President Kaplan (who has been a supporter of tapering for months), Atlanta FED President Bostic joined him on Friday and started hinting about tapering too. Ofcourse this is superbearish for gold, as gold is the anti-dollar and viceversa. We need to see how this plays out in the coming weeks, as the preliminary PMI data on Friday and the CPI data of 2 weeks ago are showing early signs of an overheating economy, with the services PMI hitting 70. That hasn't happened in the last 25 years. Take note, 25 YEARS. Bostic is set to speak on Monday again.
In conclusion, another action packed week ahead in the markets so make sure you are on the right side of the movements that are coming up.
Love and hugs,
Cesaro
Another superbullish week with an excellent weekly close and gold looks in excellent form. We have the 7th straight green day in a row, with bull candles showing exhaustion near the weekly top Boilinger Band. This should be good enough for a 40-50 dollar retrace. This retrace is obviously a gift from the big guys for us little fish to catch the bull ride to 1920 with some possible slippage to 1930. From there we need to reassess the situation, as that level is a strong bearish zone.
I need to make note that we are still in a bearish trend until 1960 is taken out, creating a higher high on the daily chart since the bear-rally to 1680. Until then, this might just be a (strong) bullish retrace. It looks like a nice sell from a technical point of view as we are near the 0.272 fibo retracement level (1883) and near the 2020 closing price (1893), but this can only be confirmed after we see a strong bearish daily reversal pattern (usually preceded by a week of heavy ranging). If the bears manage to break through 1820 (breaking the bearflag), then for me the bullish trend has officially ended and we are looking at a bearish hostile take-over that can bring us all the way down to 1600.
For the time being, I remain bullish on gold and will be looking to buy dips on important fibo levels until proven otherwise. I will avoid buy limits, as the current H4 candle pattern reminds me of the pattern preceding the $115 big bear candle of November 9th 2020 (better be safe than sorry). Rather I will keep an eye on the chart to look for a bullish divergence on lower timeframes, bullish harmonics or bearish exhaustion near important support levels.
So far the dollar seems helpless and the weekly candle barely closed above 90. However, we have a triple bullish divergence on the daily there, and a bullish relief rally can't be ruled out. With the last triple divergence, the dollar travelled 4 points from 89 to 93. From a fundamental point of view, we had the FOMC minutes on Wednesday where tapering has been mentioned for the first time since the corona-crisis in 2020.
After Dallas FED President Kaplan (who has been a supporter of tapering for months), Atlanta FED President Bostic joined him on Friday and started hinting about tapering too. Ofcourse this is superbearish for gold, as gold is the anti-dollar and viceversa. We need to see how this plays out in the coming weeks, as the preliminary PMI data on Friday and the CPI data of 2 weeks ago are showing early signs of an overheating economy, with the services PMI hitting 70. That hasn't happened in the last 25 years. Take note, 25 YEARS. Bostic is set to speak on Monday again.
In conclusion, another action packed week ahead in the markets so make sure you are on the right side of the movements that are coming up.
Love and hugs,
Cesaro
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