Restricted P.A seen on gold...
Weekly perspective:
Recording its fifth consecutive losing week, the price of gold eventually closed beneath support at 1214.4 last week. Though it is not what we’d consider a ‘decisive’ close, the possibility of further selling as far south as the 2017 yearly opening level at 1150.9 is there. Note there’s limited active demand to the left of current price between these two levels.
Daily perspective:
While weekly price eyes lower levels, daily movement appears poised to shake hands with nearby demand plotted at 1195.1-1204.1 after a number of failed attempts to breach resistance at 1218.3. A break of this demand area, as the weekly timeframe suggests, opens the pathway south to another layer of demand at 1171.1-1185.0 (not seen on the screen).
H4 perspective:
A closer look at price action on the H4 timeframe, however, shows the yellow metal has been carving out a consolidation between Quasimodo support at 1207.1 and supply at 1221.2-1217.5 since the beginning of the month. Note daily resistance mentioned above at 1218.3 is seen encased within the aforesaid H4 supply. Outside of this H4 range, August’s opening level at 1223.5 is seen, along with another Quasimodo support at 1200.4.
Areas of consideration:
We’re sure most technicians would agree, medium-term direction is somewhat restricted in this market right now. Yes, we have a break of weekly support at 1214.4, but it lacks energy, in our view. Plus, sellers have to contend with a number of competing structures on H4 and daily timeframes. For that reason, medium-term trend trading is out of the question for the time being it seems.
Range traders may wish to try and take advantage of the small H4 range currently in play. We would strongly recommend drilling down to the lower timeframes and attempting to pin down an entry there, as this should help increase risk/reward. A H1 pin-bar formation, for example, formed within the current H4 demand would be such confirmation. Stop-loss orders can then be positioned beneath the candle low, targeting the opposing end of the noted H4 range: supply.
Recording its fifth consecutive losing week, the price of gold eventually closed beneath support at 1214.4 last week. Though it is not what we’d consider a ‘decisive’ close, the possibility of further selling as far south as the 2017 yearly opening level at 1150.9 is there. Note there’s limited active demand to the left of current price between these two levels.
Daily perspective:
While weekly price eyes lower levels, daily movement appears poised to shake hands with nearby demand plotted at 1195.1-1204.1 after a number of failed attempts to breach resistance at 1218.3. A break of this demand area, as the weekly timeframe suggests, opens the pathway south to another layer of demand at 1171.1-1185.0 (not seen on the screen).
H4 perspective:
A closer look at price action on the H4 timeframe, however, shows the yellow metal has been carving out a consolidation between Quasimodo support at 1207.1 and supply at 1221.2-1217.5 since the beginning of the month. Note daily resistance mentioned above at 1218.3 is seen encased within the aforesaid H4 supply. Outside of this H4 range, August’s opening level at 1223.5 is seen, along with another Quasimodo support at 1200.4.
Areas of consideration:
We’re sure most technicians would agree, medium-term direction is somewhat restricted in this market right now. Yes, we have a break of weekly support at 1214.4, but it lacks energy, in our view. Plus, sellers have to contend with a number of competing structures on H4 and daily timeframes. For that reason, medium-term trend trading is out of the question for the time being it seems.
Range traders may wish to try and take advantage of the small H4 range currently in play. We would strongly recommend drilling down to the lower timeframes and attempting to pin down an entry there, as this should help increase risk/reward. A H1 pin-bar formation, for example, formed within the current H4 demand would be such confirmation. Stop-loss orders can then be positioned beneath the candle low, targeting the opposing end of the noted H4 range: supply.
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