head-bg-right

All posts

FOREX Chart Of The Day: Could Gold Prices Fall?

Is the price of #Gold set to fall lower?

In our latest video we take a look at the seasonal reports and identify what key levels to watch for when trading the commodity.

Watch the video to learn more…

Hi, and welcome to this Blueberry Markets video update with me, John Kibbler, head currency analyst. 

Practice trading with a demo account

In this video, we’re going to take a look at the price of gold. I haven’t covered gold for a while. I just wanted to talk about it in a little bit of detail. Recently we’ve been talking about the opportunities to buy the Dollar, and we were looking for the market to follow that seasonal bias. We still want to look for that. However, last week we saw a little bit of weakness coming through.

But we’re still longer-term looking for that Dollar strength to follow through, and that’s where I feel we could potentially look towards the indices, and have a little look at the commodities as well to see where we could potentially look for some further Dollar strength. 

Gold is one of those where we could look for a little bit of short-term Dollar strength as well. Now, just looking at a seasonal chart before starting the video. Gold has followed a seasonal plan quite well, in terms of typically through the end of March. 

In March, we find a low in the market, which in this area just through here. Then typically we kind of move sideways through April and May, which we’ve had this year. Then we typically rally towards the end of August. 

August usually is a little bit August-September is a little bit bearish and flattens out through October-November, then we rally from the end of November and the rest of the year. 

 

Looking at this, we can look at this and say, well, the market’s following a seasonal pattern at the moment. It kind of played out the way that it’s supposed to have in the last  20 years of data. 

So, looking at that and looking at what we can see price doing at the moment, I’m expecting maybe a pushback down into these current weekly lows that we can see on the chart, and for the potential for gold to rally for the remainder of the year.

If we take a look at this in a little bit detail, how could we potentially trade off the back of this information? If I place a supporting level through here, we can see that price has recently bounced off of here and rallied up,  came back down, retested recently, and he’s made another little rally, and then it came back up into these sort of weekly lows just through there, and it’s starting to reject. 

 

Going to the daily time frame, we’re seeing a familiar pattern here than we have across our major currency pairs. We’ve had almost like a move to the downside. It looks quite similar to the Australian Dollar pattern at the moment or even the Kiwi pattern where we have almost a higher high pullback into these lows. A fake breakout, or a false breakout through here and then, we see that continuation of the trend.

 

We can see here the market just stalled at this point. We breakthrough, we make that low, the market then forms a higher high, false breakout. Are we going to see another push back down into these key lows here? 

Then it’s up to the market whether it will take those out or whether we will see the rest of that seasonal pattern play out. But looking at this to me at the moment, gold looks to be pushing back towards these key lows just through here. 

If we go down into that four-hour timeframe can we identify key-areas to watch for short positions? Quite like the idea of looking back up towards this area here, where the market found some support recently just with that bullish candlestick through there. Approaching a previous structure high on the four-hour timeframe at the moment. 

 

Price kind of made a double top breakthrough, made a high through there where the price is currently sitting at the moment. We could look at this and potentially look for the market to pull back into this structure point that we’ve just pointed out. You can see the market has a lot of resistance and support at that point. Then we can look for the continuation of gold to press back down into these key weekly loads through there. 

Short term thinking looking for some gold shorts into this level through here. Then huge weekly support. If it breaks, we can look for further downside. If it bounces, we can look for that seasonal play to play out. So quick analysis here on gold, look for short-term short opportunities. 

 

Thanks for watching the video, and I’ll speak to you soon.

 

Curious to try trading gold instead of currencies? Open a demo account with Blueberry Markets and get a free $50,000 to trade with. Our customer support team can help you set up your account and have you trading in no time.


Blueberry Markets is not a financial adviser, and does not issue advice, recommendations, or opinion in relation to acquiring, holding or disposing of a margined transaction. We provide general advice only and accordingly you should consider how appropriate the advice (if any) is to your objectives, financial situation and needs before acting on the advice.