Gary S.Wagner
Add to Bookmarks
Gold Bars

The first of the double bottom’s occurred during the first week of March and then trading back to that price point on March 31st. What followed was over a month of strong price advances that unfolded as a stairstep pattern in which gold prices would advance and then consolidate trading sideways at that new higher price level.

Know where Gold is headed? Take advantage now with 

Trading Derivatives carries a high level of risk to your capital and you should only trade with money you can afford to lose. Trading Derivatives may not be suitable for all investors, so please ensure that you fully understand the risks involved, and seek independent advice if necessary. A Product Disclosure Statement (PDS) can be obtained either from this website or on request from our offices and should be considered before entering into a transaction with us. Raw Spread accounts offer spreads from 0.0 pips with a commission charge of USD $3.50 per 100k traded. Standard account offer spreads from 1 pips with no additional commission charges. Spreads on CFD indices start at 0.4 points. The information on this site is not directed at residents in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

Prior to the conclusion of the double bottom, gold was trading under all three major moving averages as well as the 21-day exponential moving average, with all of the major moving averages in absolute bearish alignment.

On the chart that we have included in this article, we have added a basic Fibonacci retracement which begins at the record high of $2080 down to the double bottom at $1675. The first part of the rally took pricing to the 23.6% Fibonacci retracement, which occurs at $1771.80. Concurrently gold prices had broken above both the 21-day and 50-day moving averages. Following this $100 gain in gold prices began to consolidate and trade sideways for approximately two weeks which lasted till the end of April.

On May 3, prices began to move in almost a parabolic manner in which we saw gold prices rise of $1775 to current pricing at $1836.90 in just under one week. This took current pricing above the next major Fibonacci retracement level of 38.2%, currently fixed at $1832.80. On Friday, May 7, gold hit an intraday high above that key Fibonacci level; however it was unable to sustain that price point on a closing basis. That changed today when market forces opened and closed above $1882.

As of 4:41 PM EST, gold futures basis, the most active June 2021 contract is trading up $6.30 and fixed at $1837.60. According to the Kitco Gold Index (KGX), spot gold is currently fixed at $1836.50. On closer inspection, dollar strength resulted in a decline of $0.55, with traders bidding the precious metal up by $6.35, resulting in a net gain today of $5.80 per ounce.

Based upon our technical studies, the next real target for potential resistance occurs at the 200-day moving average, which is currently fixed at $1855.90. Data from the Commodity Futures Trading Commission was reported by Niels Christensen, editor at Kitco news, which revealed that “Hedge funds are still a little reluctant to jump into the gold market even as they reduced their bearish bets with gold prices pushing back above $1,800, according to the latest data from the Commodity Futures Trading Commission.”

A move by the large hedge funds into gold could certainly take the precious yellow metal well beyond $1900 per ounce.

For more information on our service, simply use this link.

Wishing you, as always, good trading and good health,

Gary Wagner

Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Trade With A Regulated Broker