Are Gold Prices on the Verge of Fresh Yearly Highs?
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- Gold responds to slope support – prices eying yearly highs
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Gold 240min Chart
Technical Outlook: Gold prices have been trading within the confines of a well-defined ascending channel formation with prices rebounding sharply off monthly open support this week at 1268. The immediate advance is vulnerable while below 1293/95- a region defined by the 2017 high-day close & the yearly stretch highs.
That said, the near-term outlook remains weighted o the topside while within this channel with a breach above resistance targeting the upper parallel / May high at 1303 backed by the 78.6% retracement at 1321. Bullish invalidation is now raised to 1274 with a break below the monthly on 1268 needed to shift the broader focus lower.
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- A summary of IG Client Sentimentshows traders are net-long Gold- the ratio stands at +1.67 (62.6% of traders are long) –bearishreading
- Retail has been net-short since June 4th- Price has moved 5.7% higher since then
- Long positions are 2.2% higher than yesterday but 12.6% lower from last week
- Short positions are 0.2% higher than yesterday and 18.7% higher from last week
- We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests Spot Gold prices may continue to fall. That said, retail is more net-long than yesterday but less net-long from last week and the combination of current positioning and recent changes gives us a further mixed Gold trading bias form a sentiment standpoint.
See how shifts in Gold retail positioning are impacting trend- Click here to learn more about sentiment!
Relevant Data Releases
Other Setups in Play:
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- GBP/USD Prices Testing Support- Risk for Further Losses Remains
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- AUD/JPY Testing Key Support as Risk Aversion Drives Yen
- Ethereum at Risk Near-term as Prices Rally to Fresh Monthly Highs
- Written by Michael Boutros, Currency Strategist with DailyFX
Follow Michael on Twitter @MBForex or contact him at email@example.com.
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.