Wednesday, September 30, 2015

Is gold forming a triangle?

A couple of days ago we suggested 3 possible moves for gold (Gold: A road-map for the next 15 days).At that time we were neutral and in fact we remain neutral on gold.Gold broke below the support line of the rising channel and currently is moving towards 1110 support.

If gold bounces at that level then probably gold is forming a triangle (usually a continuation pattern).

If gold breaks below 1110 and especially below 1090-1095, this will mean a possible move towards 1040-1045.


 

Sunday, September 27, 2015

Gold: A road-map for the next 15 days

Recently Gold managed to break above the resistance at 1135.
Currently gold is moving along a steep rising channel and next resistance level lies at around 1165 (previous regional high on 23/8/15).Above 1165 there is heavy resistance at 1180 level.

Currently as we explained in a previous post(Gold: Ready to make a move?), we remain neutral about gold. Below we describe a bullish, a neutral and a bearish pathway for gold depending on the price action at different important levels:

A)Bullish scenario
Gold retraces towards the lower channel line near the support line of 1136 where it bounces and moves above 1167 level towards 1175-1180 (channel resistance and heavy horizontal resistance) where it will probably correct towards 1160-1165.A break above 1180 level can be a very bullish event.

B)Neutral Scenario
Gold breaks below the channel support and horizontal support at around 1136 and then after a small pause moves towards 1110

C)Bearish scenario
Gold moves below 1110 after forming a Head and Shoulders (three black wedges).This formation points towards 1100.A move below 1110 is a significant bearish event.A move below 1090-1095 will be a very bearish event for gold 


Wednesday, September 23, 2015

Brazil turnaround?....Under conditions the unthinkable can happen

Currently Brazil (EWZ) is in a well established downtrend since a year ago(-57% since last Sept).

Yesterday EWZ closed(21.90) just below the critical level of 22 forming a gap.Today is going to be a very interesting day regarding the price action of EWZ.
2 possible scenarios:
A) EWZ closes well below 22.That will probably mean that the gap was actually a continuation gap and will lead EWZ towards 14.
B)EWZ closes above 22.In that case a possible inverted H&S formation is on the cards.In that case we need to see a fast move with relatively increasing volume(PVO already is increasing and is ready to cross zero level).This upmove needs to break 23.8 level and close above this price level.Then a correction towards around 23.3 will complete the pattern of an inverted H&S.
 However wait until almost today's close.Don't catch the falling knife...Be ready to catch the handle.

Wednesday, September 16, 2015

Gold: Ready to make a move?

Gold after bouncing at resistance zone of 1155-1160(Gold at resistance zone) moved downwards towards support at 1105$.Currently Gold is lying between 2 support and 2 resistance zones(green and red lines respectively).

At this point Gold is in an established long-term downtrend (beneath 200 SMA).Short-term Gold is neutral.In order to establish a new uptrend or confirm the current downtrend gold needs to move above 1155-1160 resistance zone or below 1075 support respectively.
We believe that a significant move of gold price is in the cards.As we can notice in the weekly Gold Volatility Index chart ($GVZ), gold volatility after bottoming during last summer is now in an uptrend.

Currently we are neutral on gold.Above 1155-1160 gold will turn bullish and the next target will be 1190-1200.
Below 1075 gold will be bearish and next target will be 1025$