Gc1!!
Metals Set Up For Sells Based on COT AnalysisGold, Silver & Palladium are nicely setup for shorts if we get a confirmed bearish trend change on the daily.
Worth noting, Palladium recently had a major bullish divergence trigger, which implies higher prices coming for this market.
Enjoy your week.
Gold supercycle will take it to near half a million bucksGold is currently on its 3rd rise of secular parabolic run.
Not expecting any meaningful sideways consolidation until a few years from now...
Gold topped $2500 per ounce psychological high. Here's whyThe price of spot gold climbed $2500 per ounce to a new record high, by mid-August, 2024.
The Yellow metal has rallied 21.5% this year, and this is the best result in this time against Top 4 american indices - Dow Jones Industrial Avg (DJIA), SP500 (SPX), Small cap Russell2000 (RUT) and full of tech stocks Nasdaq-100 indices (NDX).
Gold jumped as much as 1.8% on Friday, as investors inflation expectations are still extremely high, and still there're no convincing sign that major Russia - Ukraine conflict as well as Israel - Arab conflict are near to be settled.
Even recent weakness in US labor market and new-home starts fall to the lowest level since 2020 give no power to Federal Reserve (US Central Bank) to cut an interest rate even to 1/4 per cent.
Last 2 years, a lot of banksters forecasted that Fed will cut interest rate.
In fact - it still didn't. Just blah-blah-blah and super-duper AI hype, which based on nothing.
In technical terms, spot Gold breaks its $2500 psychological high, ready to go further, up to 3k.
GOLD → Retest of range support in a bull marketFX:XAUUSD is trading inside the channel and is not yet ready to approach the resistance with the target of ATH retest. Profit-taking amid increased risk due to news, economic data affect the price of metal.
Price is closing inside the range of 2748-2713. A support retest is forming and liquidity capture may reignite upside interest. Traders are waiting for the Fed's actions: which side will the regulator take - aggressive or conservative strategy of policy easing? We should not forget the uncertainty around the US presidential election combined with growing geopolitical concerns in the Middle East.
For today, all eyes are on Durable Goods Orders (MoM) (Sep), which could provide new hints on the state of the US economy
Resistance levels: 2722, 2729, 2737, 2748
Support levels: 2713 (trigger), 2702
Emphasis on 2713. Price may test this area. Based on how buyers are defending the support, the market may form a false breakout and bounce to resistance. But, if the bounce is minimal, and then the price starts to retest 2713 and consolidate, we have increased risks to break the support. In this case, the price will head towards 2700-2685
Rate, share your opinion and questions, let's discuss what's going on with ★ FX:XAUUSD ;)
Regards R. Linda!
GOLD decreased slightly from 2,741 USDFriday (October 25) in the Asian market, OANDA:XAUUSD suddenly decreased rapidly in the short term. Gold price is close to 2,725 USD/ounce, down more than 9 USD during the day as of the time this article was completed.
The latest news is that the United States and Israel plan to restart ceasefire negotiations in Gaza, which has affected gold prices in the short term.
The US and Israel plan to resume ceasefire negotiations in Gaza
U.S. officials said Thursday that U.S. and Israeli negotiators will gather in Doha in the coming days to try to restart talks to reach an agreement on a ceasefire and the release of hostages in Gaza. , Reuters reported today (Friday.)
Qatar and Egypt acted as intermediaries in the months-long negotiations between Israel and Hamas. Previously, negotiations broke down in August this year, making it impossible for the two sides to reach an agreement to end the conflict. The conflict began when Hamas launched an attack on southern Israel on October 7, 2023.
Israeli Prime Minister Benjamin Netanyahu's office said David Barnea, the head of Israel's Mossad intelligence agency, would travel to Doha on Sunday, adding that CIA Commissioner William Burns would attend the talks.
US Secretary of State Antony Blinken traveled to the Middle East this week in hopes of restarting ceasefire talks in Gaza following the death of Hamas leader Yahya Sinwar. Washington sees Shinwar as the main obstacle to a deal.
“Going back to the ceasefire negotiations and the hostage issue, one of the things we're doing is looking at whether there are different options that would allow us to get to an outcome,” Blinken said. ”.
In terms of economic data
The number of people filing for first-time unemployment benefits in the United States unexpectedly fell last week, but the number of people receiving benefits increased in mid-October, raising the risk of a rise in the unemployment rate this month. .
Initial jobless claims for the week ended October 19 fell from 15,000 to a seasonally adjusted 227,000, the U.S. Department of Labor said on Thursday. The decline in unemployment claims due to Hurricane Helen offset the spike in unemployment claims due to Hurricane Milton.
The market had forecast 242,000 applications for unemployment benefits in the latest week. Helen and Milton make it more difficult to keep your finger on the pulse of the labor market.
Unemployment rate fell to 4.1% in September from 4.2% in August. Unemployment rate increased to 4.3% in July from 3.4% in April 2023, this is which led to the Federal Reserve's unusually large 50 basis point interest rate cut last month. This is seen as beneficial for the USD and not supportive of gold.
Analysis of technical prospects for OANDA:XAUUSD
Gold was once again under pressure and fell slightly after reaching the initial target level noticed by readers in yesterday's edition at 2,741 USD, the Fibonacci price point extended by 1%.
Overall, gold needs some time to adjust as it has had a long period of continuous price increases, indicators are at overbought levels as shown by the Relative Strength Index pointing down from the 75 and still far from the nearest support level at 50.
In the short term, gold will likely test the area of 2,711 - 2,700 USD, which is considered the closest support area currently.
In the event that the $2,700 raw price level is broken below gold, there will be room for a bit more downside with subsequent targets around $2,688 – $2,672 Fibonacci price points of 0.618% and 0.50%.
Although reductions and corrections may still occur, in general the trend of gold is still up, in fact the uptrend is still being maintained with the price channel currently trending in the short term.
As long as gold remains above EMA21, within the channel, its main trend is still bullish even if downward corrections occur, and short-term price points will be noticed again as follows.
Support: 2,711 – 2,700USD
Resistance: 2,741 – 2,748 – 2,758USD
SELL XAUUSD PRICE 2766 - 2764⚡️
↠↠ Stoploss 2770
→Take Profit 1 2759
↨
→Take Profit 2 2754
BUY XAUUSD PRICE 2680 - 2682⚡️
↠↠ Stoploss 2676
→Take Profit 1 2687
↨
→Take Profit 2 2692
Corrected, GOLD recovered and the trend remained unchangedOANDA:XAUUSD significant downside correction and recovery from the key technical area around the 0.786% Fibonacci extension.
Mainly influenced by the strengthening of the US Dollar and US bond yields, along with the easing of tensions in the Middle East were the main reasons why gold prices fell sharply on Wednesday. In addition, gold prices have recently risen too sharply, technical indicators have become overbought and part of the market has chosen to take profits.
Markets are also concerned that the US presidential election in November could be competitive and it could take some time to determine a winner.
Bloomberg reported that the US presidential election in November is entering its final weeks, the race between former President Trump and Vice President Kamala Harris is taking place extremely fiercely.
A Bloomberg News/Morning Consult poll shows the two candidates are statistically tied in seven battleground states.
In all seven states, the two candidates are neck and neck, with both candidates receiving 49% support from likely voters. The poll's overall margin of statistical error is 1%.
However, the market also remains concerned that the conflict between Israel and Iran could escalate into a wider war.
Despite the short-term correction, gold prices have increased more than 30% since the beginning of this year, continuously reaching new highs. Gold's rally has strengthened over the past few months as the Federal Reserve moved to reduce interest rates.
Fund managers have also contributed to gold's rally, as hedge funds increased their net long positions in gold in recent sessions and investors increased their holdings of exchange-traded funds (ETFs).
Analysis of technical prospects for OANDA:XAUUSD
On the daily chart, gold corrected significantly after the Relative Strength Index showed gold was in the overbought area (75%). However, the correction does not bring many opportunities for further price declines as the slope of the RSI is relatively low and shows signs of bending upward, depicting a weakening sell-off sentiment.
On the other hand, gold is still above the short-term trend price channel. Note to readers in previous publications on the price channel. As long as gold remains in this price channel, its short-term trend is still bullish.
The lower edge of the price channel is also confluent with the 0.786% Fibonacci extension, making this an important support area.
Although gold has adjusted down, all short-, medium- and long-term conditions and trends are still in favor of price increases. Notable levels will be listed again as follows.
Support: 2,711 – 2,700USD
Resistance: 2,741 – 2,748 – 2,758USD
SELL XAUUSD PRICE 2741 - 2739⚡️
↠↠ Stoploss 2745
→Take Profit 1 2734
↨
→Take Profit 2 2729
BUY XAUUSD PRICE 2680 - 2682⚡️
↠↠ Stoploss 2676
→Take Profit 1 2687
↨
→Take Profit 2 2692
GOLD → Bullish flat (consolidation). News aheadFX:XAUUSD corrects to 2713, confirming strong support. We talked to you about the risks yesterday. Bulls have been actively buying the metal since the start of the Asian session, hinting at strong support...
Further gains in gold remain dependent on the upcoming PMI and jobless claims data. Traders are awaiting information on the state of the global economy, which will influence the short- to medium-term strategy against the dollar and gold...
Market nervousness ahead of key reports in the US and the presidential election will also play a role. Any potential decline in the gold price is likely to be contained for several reasons: the BRICS summit, the US elections, the ongoing Middle East conflict. In this case, gold acts as a safe haven.
Resistance levels: 2748, 2758, 2775
Support levels: 2729, 2713
ATH may be tested in the near future. Further news and high volatility, high risks may provoke profit-taking, which may bring gold back to support. And after correction the growth may resume due to strong enough interest from buyers....
Rate, share your opinion and questions, let's discuss what's going on with ★ FX:XAUUSD ;)
Regards R. Linda!
WTI crude oil trend is neutral, with more bearish conditionsTVC:USOIL continued to recover from a decrease of 1% in the previous trading day after the US announced that crude oil inventories increased much higher than expected. After falling back, it continued to rise as the US election approached causing commodities to revive inflation expectations and the possibility of a further recovery in oil prices.
The U.S. Energy Information Administration (EIA) said on Wednesday that crude oil inventories rose sharply, rising 5.5 million barrels to 426 million barrels in the week ended October 18, compared with market expectations. market for an increase of 270,000 barrels.
Current concerns about potential oil supply risks due to conflict in the Middle East have partly offset the impact on crude inventories.
On the daily chart, TVC:USOIL Trading is currently quite slow with price activity mainly around the EMA21 level.
Although WTI crude oil has recovered, the recovery is still temporarily limited by the resistance level of 72.39 USD and the 21-day moving average (EMA21). In case WTI crude oil price increases and breaks the level of 72.39 USD, it will tends to rise a little further to test the 0.382% Fibonacci retracement level.
The current recovery level of WTI crude oil is still not enough to create a bullish cycle as the Relative Strength Index is also approaching point 50, a position considered to be under pressure in terms of momentum.
Once WTI crude oil is sold below the 0.236% Fibonacci retracement level, the recovery cycle will end with the target level then around $68.19 in the short term, more so than $67.14.
During the day, the technical outlook for WTI crude oil is currently neutral, with more bearish conditions and notable levels listed below.
Support: 70.56 – 68.19USD
Resistance: 72.39 – 73.80USD
GOLD eased slightly from new era highsContinuing to be influenced by the approaching US presidential election and the increasingly new conflict in the Middle East, along with other conflict risks in the Asian region have boosted OANDA:XAUUSD continues to be the top haven asset refreshing to new all-time levels.
A Reuters/Ipsos poll shows Democratic Vice President Kamala Harris leading former Republican President Donald Trump by a slim margin, 46% to 43%.
Strong buying activity by central banks and expectations of US interest rate cuts have also supported gold's 33% increase this year. Fed officials continue to weigh in on the future, with Jeffrey Schmid favoring a slower pace of rate cuts and Mary Daly predicting deeper cuts.
Citigroup raised its three-month price forecast by 3.7% to $2,800 an ounce on expectations that continued labor market weakness will boost demand.
Israel and its rivals Hamas and Hezbollah have vowed to continue fighting in Gaza and Lebanon, leaving little hope for a solution to the ongoing conflict in the Middle East. Rising geopolitical tensions often cause investors to flock to safe-haven assets such as gold as a "bunker" against risk and uncertainty in global markets.
In the context of geopolitical and economic instability, gold is considered a safe haven tool to hedge risks, and lower interest rates also increase gold's investment appeal. Gold is up more than 33% this year and has renewed all-time record highs multiple times.
Analysis of technical prospects for OANDA:XAUUSD
Gold has not yet broken the price channel with the upper edge confluent with the price channel and this is considered the most important resistance currently.
Gold is down a bit from the aforementioned confluence but overall in the interim it can only be seen as a weak correction signal, with the Relative Strength Index pointing down without breaking the 75 level, if the RSI turns down Below level 75 it will send a clearer signal for a correction towards the 50 area.
Temporarily, gold's decline should only be considered a short-term correction, technical conditions still support the possibility of price increases. However, in case gold falls below the 1% Fibnonacci level it would be a good signal for a possible further correction with a target then around $2,721 and more to the $2,711 Fibonacci level. 0.786% expansion.
During the day, the bullish prospect of gold prices with technical correction cases will be noticed again by the following price points.
Support: 2,721 – 2,711
Resistance: 2,748 – 2,750
SELL XAUUSD PRICE 2767 - 2765⚡️
↠↠ Stoploss 2771
→Take Profit 1 2760
↨
→Take Profit 2 2755
BUY XAUUSD PRICE 2709 - 2711⚡️
↠↠ Stoploss 2705
→Take Profit 1 2716
↨
→Take Profit 2 2721
GOLD → Who pressed the accelerator? Is the RALLY still going on?FX:XAUUSD continues its bull run. Prices are rising and so are the risks (before the news). What influences the growth and what to expect from the metal that surprises speculators?
Gold continues to rise despite a rising dollar, which is rising mainly on economic data and the growing likelihood of Trump winning the US presidential election.
Escalating geopolitical tensions between Iran and Israel, renewed talks on de-dollarization ( There has been speculation about the creation of a gold-backed currency in the wake of the three-day BRICS summit) are supporting the metal.
Gold is technically at highs, which increases the risks of an unpredictable correction due to the approaching news from the US. Also the focus on China markets and the BRICS summit...
Resistance levels: 2758
Support levels: 2749, 2737, 2728
The upside may continue from the local support areas as we are trading in a strong bull market. The focus is on 2749-2737-2728-2713. The market may form another flat or consolidation before the growth...
Rate, share your opinion and questions, let's discuss what's going on with ★ FX:XAUUSD ;)
Regards R. Linda!
GOLD recovered after adjusting from the target levelOANDA:XAUUSD recovered after a correction since reaching the reader attention target increase in previous issues at 2,741 USD.
Gold soared to a new all-time high on Monday hitting $2,740.60 an ounce. Uncertainty over the US presidential election and war in the Middle East have contributed to gold's rally, which has been fueled by expectations of lower Fed interest rates.
Gold prices have risen this year and have consistently hit record highs, a recovery that has accelerated over the past few months as the Federal Reserve moved to cut interest rates. Worsening tensions in the Middle East and upcoming US elections are also increasing demand for gold as a safe-haven asset.
Citi Research raised its three-month gold price forecast in a report on Monday, citing a possible continued slowdown in the US labor market, interest rate cuts by the Federal Reserve and increased gold purchases. physical and ETF funds.
The bank raised its 3-month gold price forecast to $2,800 from $2,700 previously and said its 6- to 12-month gold price forecast is $3,000.
Specifically, the report said: “We note that despite weak retail physical demand in China and rising US interest rates, gold and silver have performed very well since the Fed cut interest rates by 50 points. basis last month and nonfarm payrolls exceeded expectations.”
According to the latest Washington Post poll, Republican candidate Trump and Democratic candidate Harris are still tied in 7 important states.
However, on core issues such as the economy, inflation and immigration, Trump's approval rating is higher than Harris's. A Trump victory would mean a completely different story, with more taxes and restrictions likely to negatively impact inflation, forcing the Fed to abandon its current loose monetary policy, meaning If Trump wins the election, it is likely that the USD will strengthen again and gold will come under significant pressure.
Regarding the situation in the Middle East, according to local authorities, Israel conducted air strikes across Lebanon at night, targeting Hezbollah's financial activities. "We will continue to fight Iran's proxies until the country collapses," said Israeli Foreign Minister Israel Katz.
Analysis of technical prospects for OANDA:XAUUSD
On the daily chart, after adjusting from the target increase of 2,741 USD, gold recovered when approaching the nearest support level at the Fibonacci extension level of 0.786% price point of 2,711 USD.
The current recovery is significant and is once again close to the key technical level at $2,741, the $2,741 level being the confluence of resistance of the upper channel edge and the 1% Fibonacci extension.
If gold breaks above $2,741 it will be primed for a new bull run ahead, and indeed the target after gold breaks $2,741 is not to be found beyond round price points like 2,750 – 2,800 USD.
During the day, structurally and the short-term trend remains unchanged to the upside with upward momentum remaining very strong as the Relative Strength Index points steeply upward without any signs of a bend or heading down from the overbought area, although the room for price increases is no longer large, there will still be enough motivation for shock increases (short and strong) before adjusting downward.
The upward trend in gold prices on the daily chart will be noted by the following technical points.
Support: 2,711 – 2,700USD
Resistance: 2,741 – 2,750USD
SELL XAUUSD PRICE 2762 - 2760⚡️
↠↠ Stoploss 2766
→Take Profit 1 2755
↨
→Take Profit 2 2750
BUY XAUUSD PRICE 2694 - 2696⚡️
↠↠ Stoploss 2690
→Take Profit 1 2701
↨
→Take Profit 2 2706
XAUUSD hit the MA50 (1h). New bullish wave starting.Gold hit today its MA50 (1h) for the first time since October 15th.
This is an attempt to form the new Higher Low inside the short term Channel Up.
The last correction towards the bottom was on a -1.08% decline. The price is close to that currently.
Trading Plan:
1. Buy on the current market price.
Targets:
1. 2770 (top of Channel Up and +2.50% rise).
Tips:
1. The RSI (1h) hit the Support (1) level from exactly the last Higher Low on Oct 15th.
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Notes:
Past trading plan:
GOLD is fully supported with a low data trading weekDue to escalating tensions in the Middle East, uncertainty about the US election and expectations of looser monetary policy, OANDA:XAUUSD surged up and created new all-time record highs.
The market will still focus on increasing geopolitical tensions after Israel announced the killing of Hamas leader Yahya Sinwar. Sinwar was the mastermind of the Hamas attack on southern Israel that sparked the year-long Gaza war.
Prime Minister Benjamin Netanyahu said Israel will continue to fight until all hostages captured by Hamas last year are released, while US President Joe Biden said it is time for the war to end.
During times of geopolitical and economic instability, investors often turn to gold as a safe haven asset. Rising geopolitical tensions in the Middle East have prompted investors to seek safe-haven assets such as gold, due to risk aversion and concerns about instability in global markets.
On the monetary policy front, the European Central Bank could cut interest rates again in December. According to CME Group's FedWatch Tool, traders also see a 90.4% chance of a Fed rate cut. interest rate in November. Since gold does not yield interest, a rate cut could reduce the opportunity cost of investing in gold and increase its appeal.
This week, the People's Bank of China will announce its decision on interest rates. In September this year, the People's Bank of China kept the one-year prime lending rate (LPR) and five-year LPR unchanged at 3.35% and 3.85%, respectively. The larger LPR cut should be seen as an impetus to push gold prices even higher early next week.
S&P Global will release the preliminary value of the US Purchasing Managers' Index (PMI) for October next Thursday. If the PMI unexpectedly falls below 50, indicating a contraction in private sector business activity, the short-term reaction could pressure the dollar and push up gold prices. On the other hand, a positive surprise could support the dollar.
The market reaction to the PMI data was not large enough to have a lasting impact on gold prices.
In general, this week will be a week with quite a bit of economic data, but with the current basic picture, gold will still be focused on due to escalating geopolitical developments. Readers also need to pay attention. add other threats of conflict from China - Taiwan, North Korea - South Korea,... in addition to the Middle East region, which already has too many potential risks.
Economic data to watch out for this week
Monday: IMF meeting begins
Tuesday: BRICS summit begins in Russia
Wednesday: Bank of Canada monetary policy meeting, US existing home sales
Thursday: Weekly unemployment claims; S&P Global Manufacturing and Services PMI Survey; US new home sales
Friday: US durable goods orders
Analysis of technical prospects for OANDA:XAUUSD
As we have sent to readers throughout the publications, the gold price still has an overall bullish technical structure on the daily chart. Currently, gold closed above the 0.786% Fibonacci extension level and this is necessary for it to continue towards the next target of about 2,741 USD price point of the 1% Fibonacci level.
With the trend from the price channel in the short, medium and long term, gold is in an upward trend, combined with a strong upward momentum when the Relative Strength Index (RSI) points up with a significant slope. There is no sign of a break from the overbought level, a signal that the bullish momentum continues ahead.
However, the level of 2,741USD is also the closest current resistance for expectations of a short-term correction because it is also the confluence position of the edge on the price channel with the 1% Fibonacci extension level, correction price drops. Corrections are not considered trends, they only have a short-term impact.
Finally, the main technical outlook for gold prices is bullish, the notable points will be listed again as follows.
Support: 2,711 – 2,700 – 2,688USD
Resistance: 2,741USD
SELL XAUUSD PRICE 2741 - 2739⚡️
↠↠ Stoploss 2745
→Take Profit 1 2634
↨
→Take Profit 2 2629
BUY XAUUSD PRICE 2699 - 2701⚡️
↠↠ Stoploss 2695
→Take Profit 1 2706
↨
→Take Profit 2 2711
Crude Oil Monday BluesLooking for Crude oil to take some BSL and then look for shorting opportunities to head south for today.
If not then will be waiting.
How to Position if you Missed the Gold RallyGold prices have reached another all-time high, supported by strong bullish momentum. However, the composition of buyers has shifted. While central banks fuelled the previous phase of the rally, institutional investors and retail buyers are now leading. Over the past six months, ETF inflows have totalled nearly $5 billion, and asset managers continue to build net long positions, nearing the peak levels seen during the pandemic.
Despite the bullish outlook, higher prices are tempering demand and reducing the potential for future returns. As an alternative, investors can opt for a tactical position using CME Micro Gold futures and the Van Eck Gold Miners ETF (GDX).
RATE CUTS ARE A GOLD DRIVER
Over the past four easing cycles, gold prices have appreciated by 10% following the start of Fed rate cuts. This time around, prices are up 5% since the first rate cut in September. That leaves room for further gains as the Fed cuts further.
Still, it is crucial to consider that gold prices are already trading at an all-time-high. Higher prices are pressuring further gains and consumer demand.
According to Prithviraj Kothari, president of the India Bullion and Jewellers Association (IBJA), gold demand during this year’s festival season in India is likely to be 20% lower YoY in terms of quantity of gold purchased.
CENTRAL BANK BUYING NO LONGER THE DRIVING FACTOR
Since April, the People's Bank of China (PBoC) has halted gold purchases, while Poland and India acquired 24.3 tons and 17.7 tons of gold, respectively, between June and August, exceeding their purchases from March to May. However, the pace of buying from these central banks may be slowing. The latest data from the Reserve Bank of India (RBI) shows a decline in gold reserves by $98 million to $65.6 billion, indicating a slowdown in gold accumulation despite still substantial holdings.
One of the largest buyers of gold this year, Turkey, also slowed its pace of purchases as it acquired just 7.9 tons of gold between June and August compared to 27.6 tons between March and May.
Source: World Gold Council
Additionally, the urgency for central banks to buy gold has lessened. Earlier, rising yields and a strong U.S. dollar prompted increased gold buying. As U.S. interest rates decrease, a weakening dollar is expected.
ASSET MANAGERS NET LONG POSITIONING IS NEAR ALL-TIME-HIGH
Asset Manager net long positioning has increased consistently over the last six months. It is near the highest level since the pandemic and 2016. Crucially, the increase in long positioning has been driven by both increasing longs and declining shorts indicating bullish consensus among asset managers.
SUBSTANTIAL ETF INFLOWS OVER THE PAST 6 MONTHS
Gold ETFs listed in the US have accumulated USD 4.9 billion in inflows over the past 6 months. Inflows have grown by more than USD 1.7 billion since the Fed cut rates in September. While substantial outflows were observed on 8/Aug as global markets fell sharply, the decline was reversed in just 2 weeks.
Gold ETF inflows tend to follow cyclical patterns, and their current levels are relatively modest compared to previous inflow cycles, which have been significantly larger.
Substantial flows to gold ETFs and rallies in gold prices also tend to trigger flows into gold miner ETFs. Though these flows tend to lag flows into gold ETFs by several months.
GOLD MINERS HAVE STARTED TO CATCH UP
The outlook for gold remains mixed. While bullish momentum is supported by the anticipation of a Federal Reserve easing cycle, gold is already near all-time highs, which is discouraging further investment, particularly from retail investors.
A strategic way to capitalize on the later stages of a gold rally is through gold mining stocks. Gold miners typically lag behind gold during rallies, as returns from equities take longer to materialize and involve greater risk compared to direct gold investments. However, the impact of higher gold prices on miners' profitability is clear. In Q2 2024, Barrick, the world's largest gold miner, saw net income rise by 24% quarter-over-quarter, driven by a 13% increase in realized gold prices. Similarly, Newmont's net income increased by 32%, alongside a 12.3% rise in gold prices.
Gold miners are also benefiting from easing cost pressures. While costs remain high compared to last year due to inflation and energy-related increases, they improved in Q2, and further reductions are expected based on company guidance.
The gold to gold miner ratio is a cyclical quantity that has been trending higher for decades but also tends to mean-revert when the ratio edges to far in either direction.
As the ratio is due to cross the 200-week moving average, it may be due for an extended period of decline favouring gold miners.
HYPOTHETICAL TRADE SETUP
Gold remains bullish through the Fed easing cycle and strong investment demand provide momentum. However, higher prices are dampening consumer demand and central bank buying is slowing. Further increase in gold is likely, however, further gains may be limited. Gold prices have already realized half of their average increase following a rate cut.
Alternatively, a position that is long on gold miners also benefits from rising gold prices.
Gold prices, as tracked through gold futures, are highly correlated with gold miners, measured by ETFs like GDX and SGDM, with a correlation coefficient typically near 0.9, though there are occasional period breaks. Since December 2023, gold prices have outperformed SGDM by nearly 20% and GDX by 5%.
As the current gold rally progresses, increased flows into gold miner ETFs are expected to support their prices. Additionally, improving cost structures for miners and higher realized gold prices create positive momentum.
Investors can hedge a long position in GDX by taking a short position in CME Micro Gold futures. This hedge protects the ETF position against potential declines in gold prices. The smaller contract size of CME Micro Gold futures makes them ideal for precise hedging, particularly given the smaller unit size of ETFs like SGDM.
637 units of GDX (at a price of 43.15 as of 18/Oct) are balanced by a hedge of 1 CME Micro Gold futures contract expiring in December. CME Micro Gold Futures require margin of just USD 1,100 while the GDX leg requires notional of USD 27,470.
The position offers multiple income-generating advantages. The GDX ETF provides a net dividend yield of 0.65% (after accounting for the management fee), and the short position in CME Micro Gold futures benefits from contango, which adds approximately 1% per quarter.
The payoff scenarios for this position are provided below:
MARKET DATA
CME Real-time Market Data helps identify trading set-ups and express market views better. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.com/cme .
DISCLAIMER
This case study is for educational purposes only and does not constitute investment recommendations or advice. Nor are they used to promote any specific products, or services.
Trading or investment ideas cited here are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management or trading under the market scenarios being discussed. Please read the FULL DISCLAIMER the link to which is provided in our profile description.
XAUUSD quick pull-back is in order.Gold (XAUUSD) couldn't have gone better on our last call (October 14, see chart below) as after the expected minor pull-back to the 4H MA50 (blue trend-line), it rebounded and is on its way to our 2750 Target:
As however the 4H and 1D RSI got overbought, we expect a short-term pull-back. Especially the 4H RSI, as you see on this chart, is forming a pattern similar to the September 13 short-term peak sequence that was rejected back below the 0.236 Fibonacci retracement level but was contained/ supported above the 4H MA50.
As a result, we can take a quick sell and target 2705 (0.236 Fib). Notice though that the trend will remain bullish medium-term as long as the 4H MA50 holds, in case you don't want to engage into riskier short-term trades such as this one.
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GOLD → 2685 breakout trigger. News ahead. A new conflict! FX:XAUUSD stops correlating with the dollar. The price is testing the key resistance at 2685. Bulls continue to test this area and accumulate the potential for a breakout attempt. Important news on jobless claims and retail sales are ahead
China's economic problems have a negative impact on gold as the country is the world's top gold consumer. At the same time, markets are resorting to profit taking on long USD positions ahead of the release of the most important economic data - the US retail sales report.
BUT! Another escalation, but in another part of the world: North Korea has declared South Korea an enemy and completely cut off transportation links with it. The markets are clearly not going to let this fact pass their ears.....
Technically, the buyers do not retreat from their intentions and continue to test the resistance with a breakdown target. A pre-breakdown consolidation and several possible scenarios are forming, no matter how many people don't like it.
Resistance levels: 2685
Support levels: 2674.5, 2665, 2658
A breakdown of resistance will trigger an impulse, and this is a logical scenario based on the technical situation on H1 (ascending triangle, accumulation and compression to the level).
BUT! The news can have an unpredictable impact. If gold forms a false breakout and goes back to 2674, having updated this low, the price may go even lower (to 2665, 2658), for liquidity, before returning to the way north
Rate, share your opinion and questions, let's discuss what's going on with ★ FX:XAUUSD ;)
Regards R. Linda!
Natural Gas Oil, Dollar, Silver, Gold Price ForecastNatural Gas stock Bulls PEPPERSTONE:NATGAS Support & Resistance Guide
GOLD | XAUUSD Weekly Outlook Oct 21st: Keep BUYING!This weekly forecast is for Oct. 21 - 25th.
Gold is still bullish, and BUYS are still the best bet. The formation of a +FVG will support higher prices, and we may get that on Monday's close.
Check the comments section below for updates regarding this analysis throughout the week.
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GOLD MARKET ANALYSIS AND COMMENTARY - [Oct 21 - Oct 25]This week, OANDA:XAUUSD continuously increased sharply from 2,637 USD/oz to 2,723 USD/oz and closed this week at 2,721 USD/oz.
According to market observations, gold prices have skyrocketed in recent days due to the impact of many supporting factors:
First, the FED warned that it will continue to cut interest rates, although the extent of the FED's interest rate cuts may be less than the recent decision. Not only the FED, but many other central banks have also been implementing their plans to cut interest rates. This increases the appeal of gold.
Second, the level of public debt worldwide is even worse than current forecasts, while the measures that countries are taking will not be enough to prevent a sharp increase in public debt. According to the IMF, global public debt will exceed 100 trillion USD, equivalent to about 93% of global GDP, by the end of this year and will reach nearly 100% of global GDP by 2030.
Third, as central banks continue to walk the thin line between promoting economic growth and controlling inflation to prevent stagflation, global geopolitical tensions appear to be increasing day by day. Major conflicts between Ukraine and Russia, growing threats between Russia and NATO, Israel-Palestine conflict, tensions between Israel and the US with Iran, tensions between North Korea and South Korea, and many more threats Another threat has been increasing the role of gold as a haven.
Fourth, after Russia was removed from the SWIFT system on March 1, 2022, BRICS central banks increased gold reserves at a record pace, promoted currency swaps, and promoted transactions. across borders between BRICS countries is a sign that they are preparing for a global monetary reset. Meanwhile, BRICS member countries account for about 40% of global GDP. This will certainly have a negative impact on the USD.
Fifth, central banks of many countries are continuing to promote gold purchases to increase the proportion of gold in national foreign exchange reserves, causing the proportion of USD in foreign exchange reserves of many countries to decrease. down, potentially at risk of USD depreciation.
With so many of the above influencing factors, especially geopolitical conflicts, next week's gold price may increase even higher.
However, the increase in gold prices is being driven by FOMO psychology, which will pose strong profit-taking risks, especially when geopolitical tensions cool down.
📌Technically, the price is constantly setting new high price thresholds, when in turn breaking through old peak milestones, specifically in the H1 chart, the gold price is approaching the 161.8 Fibo zone, and next week it may continue to conquer. Recovering the Fibo threshold of 261.8 around the round resistance level of 2,800 USD/oz.
Notable technical levels are listed below.
Support: 2.741USD
Resistance: 2.688 – 2.700 – 2.711USD
SELL XAUUSD PRICE 2801 - 2799⚡️
↠↠ Stoploss 2805
BUY XAUUSD PRICE 2624 - 2626⚡️
↠↠ Stoploss 2620
BUY XAUUSD PRICE 2659 - 2661⚡️
↠↠ Stoploss 2655
GOLD → The realization phase continues. What are the targets?FX:XAUUSD in the phase of realizing the accumulated potential updates ATH to 2714 and is in no hurry to give up, movements can be continued...
Gold feels support from the Chinese markets after positive hints from the People's Bank of China revived hope for stimulating the economy. Also from the European side - the ECB cut its key rate, in anticipation of another, fourth cut in December...
Strong data from the US on Thursday pointed to a solid economic outlook, but this failed to change the odds of a 0.25% rate cut by the US Fed in November.
In addition, the gold price found fresh demand amid escalating geopolitical tensions between Iran and Israel (Hamas leader eliminated)
Resistance levels: 2711.7, 2715, 2720
Support levels: 2702, 2696, 2689
Technically, gold continues its bull run once again. The chart indicates key support areas that may be of interest before further rally. A correction has been forming since the opening of the European session, but price is quickly returning to ATH. If the bulls hold the defense above 2711, the growth will continue without a pullback. Targets are indicated on the chart
Rate, share your opinion and questions, let's discuss what's going on with ★ FX:XAUUSD ;)
Regards R. Linda!
Refreshing all-time level, GOLD is eligible to continue risingAs uncertainty about the US presidential election and war in the Middle East push investors to seek safe haven assets, and the monetary policy environment that tends to lower interest rates are the main factors pushing push up gold prices.
After the Federal Reserve cut interest rates by 50 basis points last month, gold prices are set to gain more than 30% this year, driven by the prospect of further rate cuts and geopolitical uncertainty.
Since gold does not yield interest, cutting interest rates could reduce the opportunity cost of investing in gold and increase its appeal.
On the geopolitical side, Prime Minister Benjamin Netanyahu said Israel will continue to fight until all hostages captured by Hamas last year are released. During times of geopolitical and economic uncertainty, investors often seek the safety of gold.
Israel announced that Hamas leader Sinwar was dead
On October 17 local time, Israeli media quoted senior Israeli officials as saying that Hamas leader Yahya Sinwar was killed by the Israeli army.
Earlier on the same day, the Israel Defense Forces and the Israel National Security Agency (Sin Bet) issued a joint statement saying that, according to preliminary reports, the Israeli army killed 3 Palestinian armed personnel during the attack. military operations in the Gaza Strip. The Israel Defense Forces and the Israel General Security Agency are verifying whether one of them is Hamas leader Yahya Sinwar.
Sinwar masterminded Hamas attacks on southern Israel, sparking a year-long war in Gaza.
Concerns about the future of the US government are also driving demand for precious metals. With three weeks to go until the election, polls show the two candidates tied, creating uncertainty.
On Thursday, economic data released by the United States supported the view that the economy will maintain strong growth in the third quarter. Signs of economic recovery may not prevent the Fed from cutting interest rates once next month, but they will reinforce expectations of a 25 basis point rate cut.
Data released by the U.S. Department of Commerce on Thursday showed retail sales rose 0.4% month-over-month in September, better than the 0.1% gain in August and better than expected. will increase by 0.3%.
In addition, the number of Americans applying for unemployment benefits unexpectedly decreased last week. According to data released by the U.S. Department of Labor on Thursday, initial jobless claims fell by 19,000 to 241,000 in the week ended October 12. Economists surveyed had forecast The average number is 259,000.
Bloomberg said Western investors also contributed to driving up gold prices. Western investors largely sat on the sidelines in the first half of the year as demand surged in Asia. The Federal Reserve's shift to a looser monetary policy has increased the appeal of gold-backed exchange-traded funds (ETFs), with their gold holdings on track to increase. 5th consecutive monthly growth in October for the first time since 2020. Longest capital flow since the beginning of this year.
Analysis of technical prospects for OANDA:XAUUSD
On the daily chart, gold has reached its target level of $2,711 after strong gains and is on track for a fourth consecutive day of gains.
Structurally, gold is still on a short-term uptrend, noticed by price channels, and even in the medium and long term, it is also increasing with price channels as the trend.
Once gold breaks the 2,711 USD price point of the 0.786% Fibonacci extension, it will have the prospect of continuing to increase in price with the target level then being around 2,741 USD the price point of the 1% Fibonacci extension.
Regarding momentum, the Relative Strength Index is pointing up with a significant slope and has not yet completely reached the overbought level, showing that there is still room for price increases ahead, with absolutely no signs of possible reduced corrections and showed solid upward momentum in the market.
As long as gold remains within the price channel it will remain bullish in the short term, notable technical levels are listed below.
Support: 2,700 – 2,688USD
Resistance: 2,711USD
SELL XAUUSD PRICE 2741 - 2738⚡️
↠↠ Stoploss 2744
→Take Profit 1 2633
↨
→Take Profit 2 2628
BUY XAUUSD PRICE 2664 - 2666⚡️
↠↠ Stoploss 2660
→Take Profit 1 2671
↨
→Take Profit 2 2676
