Gold News Update - 5 October 2018

COMMENT:
'Wood’ seemingly remains at $1208.70 (23.6% Fib) as XAU/USD was held up ahead of that level again. The market remains trapped within the broader sideways trading range between the Aug 24th low at USD 1183.20 and the Aug 28th high at USD 1214.85 but is progressing into an ever-decreasing triangular congestion zone bounded by USD 1183.20 and the downtrend resistance line. XAU/USD still needs a close above its 55 Day moving average (1202.40) but more importantly, a move and close beyond the downtrend / resistance line (USD 1211.35) and the August 28th high ($1214.85), which will signal that the market has ‘broken out’ and which would then likely draw in the momentum buyers / trend following specs.

COMMENT:
Another strong day for XAU/AUD yesterday as the market moved well beyond a few significant technical resistances that included the 50% Fib retracement at $1686.90, a cluster of highs around the $1687 level from early September, and the all-important 200 Day moving average. While the market did not close at or near the day’s high, it was a strong advance nonetheless, and the candlestick pattern known as ‘Three White Soldiers’ that was highlighted yesterday has been posted. The pattern predicts the reversal of a downtrend. Expect any pullbacks on mean reversion or profit taking to be well supported at the AUD 1679 - 1687 level. The 61.8% Fibonacci retracement and July 15th high at $1706.30 is well within striking distance but expect some resistance at this level initially. Once cleared, the way opens to AUD 1730 - 1746.50. From a technical perspective, XAU/AUD looks robust.
 

COMMENT:
Another Doji candlestick posted yesterday as XAG/USD stalls ahead of its 55 Day moving average. However, dip buying on any weakness / mean-reversion potentially as far back as the USD 14.32 - 14.37 region remains favoured with XAG/USD still having some meaty upside technical targets at USD 15.19/15.23, 15.47, 15.63 & 16.03 in sight.

COMMENT:
A long-legged Doji candlestick was posted yesterday as profit taking emerged ahead of the 38.2% Fibonacci retracement / resistance at $20.8775. With the day’s open and close at almost the same level, suggestive of market indecision around current levels, it is possible that XAG/AUD could potentially pare recent gains all the way back into the $20.2550 - $20.3550 area without negating the overall bullish technical outlook. Upside technical targets $20.88 and $21.30 are still in play and dip buying remains the preferred trading stance.