Technicals | Dec 19 2019
Bottom Line 18/12/19
Daily Trend: Neutral
Weekly Trend: Down
Monthly Trend: Up
Support Levels: 1412 / 1370 / 1284
Resistance Levels: 1533 / 1550 / 1574 (new contract)
Technical Discussion
Reasons to be optimistic (short term weakness remains in play):
? old resistance zone now looking to revert to support (see chart)
? upside price action remaining robust bigger picture
? immediate bearish head & shoulders looking to lock in a low
? geopolitical risks potentially bullish gold.
Price still hasn't tagged the bearish head and shoulders pattern target circa 1410.00. Yet close enough may well be good enough with the low tagged thus far being 1453.60. Influential in where we go from here is the immediate ledge pattern that has been in play for just on a month. As you can see on our chart, trading within this pattern has been within a tight range during this time. So it's now just a matter of which way it breaks.
A break above the upper boundaries at 1492.00 should see price embark on a minor move towards 1572 where some supply sits. Yet alternatively a drop below the lower boundaries circa 1457, will likely take price closer to pattern target circa 1422. The latter would also align a retest of the 200 day MA which has been acting robust as dynamic support all throughout 2019.
Either way technically, we continue to see signs that the Gold market has an element of buyer interest overall. They haven't dominated in any way, yet there appears to be enough positive signs to keep this market on the top of our watch-lists. Which also means keeping an eye on your favorite ASX listed Gold stocks. Especially the producers.
Trading Strategy
Our aggressive trade recommendation on the long side has triggered at 1476.00 with our stop position at 1442. As stated it was a low risk yet aggressive stance, which we may get found out on if the aforementioned ledge breaks to the downside from here, rather than to the upside. Respect the initial stop.
Re-published with permission of the publisher. www.thechartist.com.au All copyright remains with the publisher. The above views expressed are not by association FNArena's (see our disclaimer).
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