News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
Real Time News
  • Curious to know if this is because a) bailout by Beijing is still widely viewed as the base case scenario if contagion materializes and/or b) recent backstops implemented globally to curb financial market fallout have effectively supplanted left tail risk https://t.co/cFSXtb1WfQ
  • video uploaded from today's webinar https://t.co/CCrY3mYRjL
  • WTI crude rebounded nicely from session lows, now trading at $70.50 $CL #Oil #OOTT https://t.co/ik3wfuGZZe
  • RT @ZabelinDimitri: Regarding the Fed dot plot⬇️ "If another two officials were to move up their expectations for a rate increase into 2022…
  • Tonight will see Chinese markets open after a two day closure to observe mid-Autumn festival. Naturally, there will be increased focus and volatility given the current backdrop of Evergrande default concerns. Get your market update from @JMcQueenFX here:https://t.co/ky6vpyMup7 https://t.co/7TyDu8rl14
  • RT @RiskReversal: A pretty hot @MacroSetup this week, brought to you by @Nadex and @openexc. @GuyAdami & I warn the young, but mighty @CVec…
  • RT @Nadex: The Macro Setup is back! CNBC’s @GuyAdami, @RiskReversal, and special guest @CVecchioFX discuss: -Evergrande vol hurts everlong…
  • Japanese #Yen Forecast: $USDJPY Breakout Imminent- #FOMC Levels - https://t.co/U5iFDDlWPT https://t.co/f1thUfTOg6
  • RT @BrendanFaganFx: 78 counterparties take $1.240 trillion at Fed's fixed-rate reverse repo $USD $DXY https://t.co/IOcumNHCmc
  • here we go - starting right now https://www.dailyfx.com/webinars/643096611 https://t.co/SBRIykorY8
Gold Price Outlook: XAU Breakout - Too Far, Too Fast?

Gold Price Outlook: XAU Breakout - Too Far, Too Fast?

Michael Boutros, Strategist

Gold prices have surged more than 4.5% off the May lows with the breakout now testing the first major test of resistance. These are the updated targets and invalidation levels that matter on the XAU/USD charts. Review this week’s Strategy Webinar for an in-depth breakdown of this setup and more.

New to Gold Trading? Get started with this Free How to Trade Gold -Beginners Guide

Gold Daily Price Chart (XAUUSD)

Gold Price Chart - XAU/USD Daily - GLD Outlook

Technical Outlook: In my latest Gold Price Weekly Outlook we noted that the breakout remained, “constructive while above 1275/76 heading into the open of June trade with a weekly close above 1302 needed to fuel the next leg higher in price.” A topside breach / close on Friday validates a breakout of the May opening-range with the advance now testing confluence resistance at 1328/29 – a region defined by the 2019 high-week close and the 78.6% retracement of the year range.

Why does the average trader lose? Avoid these Mistakes in your trading

Gold 240min Price Chart (XAUUSD)

Gold Price Chart - XAU/USD 240min - GLD Outlook

Notes: A closer look at price action shows Gold trading within the confines of an ascending pitchfork formation extending off the May lows with the upper parallel further highlighting the 1328/29 resistance zone. The immediate advance may be vulnerable below this level, but the trade remains constructive while above the weekly open at 1305. Look for initial support around the 61.8% retracement at 1315. A topside breach of this resistance barrier would keep the focus on subsequent objectives at the yearly high-day close at 1337 and the high-close at 1341 – look for a bigger reaction there If reached.

Learn how to Trade with Confidence in our Free Trading Guide

Bottom line: The Gold price breakout is testing the first major resistance zone and leaves the immediate advance vulnerable while below 1329. From at trading standpoint, a good place to reduce long-exposure / raise protective stops. Risk for possible price exhaustion here but ultimately, we’ll be looking for better long-entries on a pullback. A break / close below 1302 would be needed to put the bears back in control. Review our latest Gold 2Q forecasts for a longer-term look at the technical picture for XAU/USD prices.

For a complete breakdown of Michael’s trading strategy, review his Foundations of Technical Analysis series on Building a Trading Strategy

Gold Trader Sentiment

Gold Trader Sentiment - XAU/USD Sentiment - GLD Price Chart
  • A summary of IG Client Sentiment shows traders are net-long Gold- the ratio stands at +1.67 (62.6% of traders are long) – bearishreading
  • The percentage of traders net-long is now its lowest since February 4th
  • Long positions are7.9% lower than yesterday and 22.3% lower from last week
  • Short positions are32.3% higher than yesterday and 60.4% higher from last week
  • We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests Gold prices may continue to fall. Yet traders are less net-long than yesterday and compared with last week. Recent changes in sentiment warn that the current Gold price trend may soon reverse higher despite the fact traders remain net-long.

See how shifts in Gold retail positioning are impacting trend- Learn more about sentiment!

---

Active Trade Setups

- Written by Michael Boutros, Currency Strategist with DailyFX

Follow Michael on Twitter @MBForex

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES