Analys från DailyFX
Gold Prices Advance in the Middle of Triangle Pattern
Gold prices continue to consolidate inside a range covering about $1200 to $1295. The Elliott Wave model we are following hints that we could see an eventual breakout above $1295, though it does call for some continued range bound trading until a triangle pattern terminates.
According to the model, I am showing gold prices are grinding sideways in a ‘B’ wave triangle. We are a little more than halfway through this triangle as the market trades higher to complete the ‘d’ wave. So long as gold prices stay between $1204 and $1295 the triangle pattern is the preferred pattern we are following.
Once this triangle exhausts, then we will anticipate a breakout higher above $1295. Once we get closer to the end of the triangle, we can identify some potential targets to the upside. Therefore, as a trader, we want to position in the direction of the trend and look for buying opportunities.
To learn more about trading Elliott Wave triangle, view this hour long webinar recording solely covering the triangle pattern with a free registration.
In the meantime, shorter term traders may recognize the impulse pattern developing from the July 9 low. It appears we are in the final stages of that small impulse and a correction lower towards $1235-$1245 may be nearby. We anticipate the correction lower to be a partial retracement of the July 9 up trend. That correction, if it develops, may offer interested long traders an opportunity. The key level to the bullish bias is the blue wave ‘c’ low near $1204.
The IG Client sentiment reading for gold is at +2.89. The number of traders net long gold have decreased since the beginning of July. This could be a subtle clue for bullish traders as the sentiment reading has been dropping from even more extreme levels. Follow this live reading and learn how to trade with sentiment at this link.
Bottom line, we are anticipating gold prices to find some support and bounce closer to the $1295 ceiling.
This is a shorter term outlook for gold. Read our quarterly gold price forecast to see what may be influencing the longer term cycles.
—Written by Jeremy Wagner, CEWA-M
Discuss this market with Jeremy in Monday’s US Opening Bell webinar.
Follow on twitter @JWagnerFXTrader .
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AUD/USD is near its highest price in 2 years; see what is next for the pair.
What’s inside:
- EURUSD broke the ‘neckline’ of a bearish ‘head-and-shoulders’ pattern, April trend-line
- Resistance in vicinity of 11825/80 likely to keep a lid on further strength
- Targeting the low to mid-11600s with more selling
Confidence is essential to successful trading, see this new guide – ’Building Confidence in Trading’.
Coming into last week we pointed out the likelihood of finally seeing a resolution of the range EURUSD had been stuck in for the past few weeks, and one of the outcomes we made note of as a possibility was for the triggering of a ’head-and-shoulders’ pattern. Indeed, we saw a break of the ’neckline’ along with a drop below the April trend-line. This led to decent selling before a minor bounce took shape during the latter part of last week.
Looking ahead to next week the euro is set up for further losses as the path of least resistance has turned lower. Looking to a capper on any further strength there is resistance in the 11825-11880 area (old support becomes new resistance). As long as the euro stays below this area a downward bias will remain firmly intact.
Looking lower towards support eyes will be on the August low at 11662 and the 2016 high of 11616, of which the latter just happens to align almost precisely with the measured move target of the ‘head-and-shoulders’ pattern (determined by subtracting the height of the pattern from the neckline).
Bottom line: Shorts look set to have the upperhand as a fresh month gets underway as long as the euro remains capped by resistance. On weakness, we’ll be watching how the euro responds to a drop into support levels.
For a longer-term outlook on EURUSD, check out the just released Q4 Forecast.
EURUSD: Daily
—Written by Paul Robinson, Market Analyst
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You can follow Paul on Twitter at@PaulRobinonFX.
Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.
EURUSD: Retail trader data shows 37.3% of traders are net-long with the ratio of traders short to long at 1.68 to 1. In fact, traders have remained net-short since Apr 18 when EURUSD traded near 1.07831; price has moved 9.6% higher since then. The number of traders net-long is 15.4% lower than yesterday and 16.4% higher from last week, while the number of traders net-short is 0.4% higher than yesterday and 10.5% lower from last week.
We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EURUSD prices may continue to rise. Positioning is more net-short than yesterday but less net-short from last week. The combination of current sentiment and recent changes gives us a further mixed EURUSD trading bias.
— Written by Christopher Vecchio, CFA, Senior Currency Strategist
To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com
Follow him on Twitter at @CVecchioFX
To be added to Christopher’s e-mail distribution list, please fill out this form
Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.
GBPUSD: Retail trader data shows 38.2% of traders are net-long with the ratio of traders short to long at 1.62 to 1. In fact, traders have remained net-short since Sep 05 when GBPUSD traded near 1.29615; price has moved 3.4% higher since then. The number of traders net-long is 0.1% higher than yesterday and 13.4% higher from last week, while the number of traders net-short is 10.6% lower than yesterday and 18.3% lower from last week.
We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests GBPUSD prices may continue to rise. Yet traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current GBPUSD price trend may soon reverse lower despite the fact traders remain net-short.
— Written by Christopher Vecchio, CFA, Senior Currency Strategist
To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com
Follow him on Twitter at @CVecchioFX
To be added to Christopher’s e-mail distribution list, please fill out this form
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