Gold closed up a point and a half today on an extremely low volatility day and ended the day trapped within the net of the 7 day moving average and the upper band of the Keltner Channel. I expect another quiet day tomorrow as the world is waiting for the results of the French election this weekend. If the populist candidate wins and the French decide they want out of the EU, this could create major disruption in the global markets. Gold could be the big winner in all of this as the precious metal would be seen as one of the last safe havens around. Even the Japanese Yen wouldn't be a safe haven bet while tensions with the North Koreans seems to mount every day.
So, while I am in the short trade, we all need to be on the watch for Black Swan events. This week may be the proverbial quiet before the storm!
But, until then, my technical analysis does show that Gold right now is a short side trade. In addition to everything I've been calling out the last week on this, I have drawn a couple of orange lines on the chart which show a clear divergence between the last high of the year from last Friday on the price chart verses the QStick indicator on the bottom. QStick is a Rate of Change indicator and it is showing that the month long bull run has lost it's steam. A pullback to the 21 day moving average at 1263 is very reasonable.
To complete the picture, take a look at the Heikin-Ashi chart. We've now had a red doji followed by a very weak red candle.
If you do stay in a trade over this potentially volatile weekend, please use good money management techniques to protect your account. :-)
Disclaimer: This post is for education purposes only. Trading is at your own risk.
So, while I am in the short trade, we all need to be on the watch for Black Swan events. This week may be the proverbial quiet before the storm!
But, until then, my technical analysis does show that Gold right now is a short side trade. In addition to everything I've been calling out the last week on this, I have drawn a couple of orange lines on the chart which show a clear divergence between the last high of the year from last Friday on the price chart verses the QStick indicator on the bottom. QStick is a Rate of Change indicator and it is showing that the month long bull run has lost it's steam. A pullback to the 21 day moving average at 1263 is very reasonable.
If you do stay in a trade over this potentially volatile weekend, please use good money management techniques to protect your account. :-)
Disclaimer: This post is for education purposes only. Trading is at your own risk.
