Let’s begin by playing the videotape from my October 15tharticle based on the October 13th weekly gold chart and analysis. To view a larger version of any chart in this article, right-click on it and choose “view image.”
“Gold bigger picture… Still BULLISH: The 50/200 Golden Cross is taking place ever so slowly. Not to be redundant, but I’ve been talking about this threat for a few months and cannot stress enough, once again, how important this is on a weekly chart. Technical analysts across the financial sphere are watching. Once it takes hold decisively, big money steps in for a ’yuge’ long-term sweet spot momo trade.”
Below is the gold weekly chart zoomed-in, as of the Nov. 3rd close…
Despite a correction in price, the in-play 50/200 Golden Cross based on Exponential Moving Averages (EMA) continues to cross over, and it even rose a bit. Given the recent downside price action, I thought they would flatten out and be considered indecisive this week. As you can see on the chart, that is not the case. The 50/200 EMA area has clearly been strong near-term support for three weekly taps, with the first being a week before publishing the Oct. 13th chart. Currently, the 50 EMA sits at $1,263.14 and the 200 EMA is at $1,259.94. Talk about molasses going uphill in a blizzard. Stealthy. Without question, we must keep eyes on its progress.
Other technical indicators keep me on the bullish side, too: 1) the 2011 topside trendline(s), which are also two Inverse H&S Necklines, were decisively breached to the upside, and depending on which you choose, price has tested the second and could still tap the first at around $1,225 and still remain bullish with a pivot. 2) 2011 trendline(s) have not violated to the downside. 3) The 38.2% Fibonacci at $1,267 is a historical pigsty, and it remains a strong support level, without a close below it within the recent price correction. 4) Since the Nov./Dec. 2015 lows, the price continues upward with higher lows. 5) Since the Dec. 2016 low, an upward channel has taken shape. 6) Near-term DMI-ADX has not crossed over into negative trend. 7) StochRSI is now at an oversold level. 8) Volume continues to rise during price surges and fall during price pullbacks.
Let’s take a look at the daily chart zoomed-in.
Within the price pullback since September, there are two Falling Wedges. Price is now “basing out” of the second. The 200 EMA is a solid support level, with seven taps upon it since the low of the first Falling Wedge. Support at the 38.2% Fibonacci is clear as well. If price breaches the 200 EMA to the downside, a target would be a pivot off the channel’s lower trendline. The studies are not as positive on the daily as they are on the weekly, which cautions that we may visit that channel trendline.
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