Gold News Update - 24 September 2018

PRECIOUS METALS RANGES- Trade Date: September 23rd

COMMENTS:
Respecting the now well established sideways trading range and selling rallies / buying dips as appropriate, continues to pay dividends as XAU/USD recoiled at its 55 Day moving average (USD 1210.50) on Friday but remained within the broader sideways trading range between the Aug 24th low at USD 1183.20 and the Aug 28th high at USD 1214.85. XAU/USD needs a close above the 55 Day moving average at USD 1209.25 and more importantly, a move and close above the downtrend / resistance line (USD 1222.25) which has remained undefeated since gold began its retreat in mid-April, before thoughts of consistently higher levels can be entertained.

COMMENTS:
While the technical stance towards XAU/AUD has remained favourable, we flagged the potential for continuing weakness down to the AUD 1643.70 level, and so it was that support at the 55 Day moving average (1654.95) yielded on Friday with XAU/AUD briefly visiting AUD 1640 before bouncing modestly. The market presently hovers back above AUD 1643.70 with the next major level of support seen in the AUD 1635.85 / 1636.85 region (August 28th low and 61.8% Fib of 1605.10 > 1688.20). While dip buying remains favoured around these levels, tight protective stop losses just beneath the August 28th low are advisable, with little by way of technical support until the August 16th low (AUD 1605.10) should AUD 1635.00 break.

COMMENTS:
XAG/USD took a brief peek above its 21 Day moving average (14.3575) on Friday, for the first time since mid-June. The white metal was unable to post a close above there however and until formidable resistance levels at USD 14.7750, and near USD 14.93 / 15.00 (55 Day moving average & August 28th high) can be cleared, downside risk back to the Sep 11th low at USD 13.9375 remains. Arguments in favour of the white metal are the magnitude of the move since mid-June, the technical significance of the USD 13.6475 level (having not been broken since December 2015) and current market positioning, which on balance, should see silver finding some friends amongst investors again soon. To the downside, a significant break and close beneath USD 13.6475, opens the way to 9 year lows.

COMMENTS:
XAG/AUD continued to hold a significant technical support line at AUD 19.54 (dating back to April 2016) for the fifth day this month but this notwithstanding, downside risk remains in play with the white metal bouncing like a dead cat, unable to move beyond its 21 Day moving average (AUD 19.8450). This market remains a “wait and see” proposition with little other than the presently solid support at AUD 19.54 to suggest that an interim low might be in place. A break beneath AUD 19.54 opens the way to the April 1st 2016 low at AUD 19.32
 
 
Kind regards,
Andre