24 May
Gold XAUUSD
- Gold collapsed through strong support at 2381/77 & if you managed to get in to a short position in time, Gold headed straight for the next downside target of 2340/35 as predicted.
We should have found good support here in the bull trend but longs needed stops below 2330 & we over ran as far as 2326.
- Gold is oversold in the short term & although it does not feel like it this week, we are still in a longer term bull trend of course. Looking back at the charts this week, there was no indication that I can see, that we would reverse so dramatically & wipe out last week’s gains. But we have.
- In fact if we close this week below last week’s low of 2332, we have an important bearish engulfing candle on the weekly chart. (When a new all time high is reached & the price then collapses below the previous candle low, creating a bull trap, when longs are holding losing positions).
Although I will not take this as an immediate sell signal, it would be a warning to bulls that the bull run may be over at this stage. It could mean we consolidate in a sideways channel, it does not necessarily mean prices are about to collapse. I then need to see what pattern develops.
- Just 1 thing to note, I think this week’s high is too far above the April high for a double top pattern to be relevant. So it’s not as negative as it could have been.
- We are attempting to recover as I write, trading at 2333. I still favour a move higher from here, but we need to see prices holding above last week’s low of 2332 & then start to move above 2340 for this to materialise. We should then target 2350 & 2355.
- Gains could be limited, with nervous short term bulls trapped in some losses, so a high for the day around 2350/55 is possible. However I think it is too risky to try a short position.
Just be aware that if we continue higher we should target 2362 & 2372.
- A break below yesterday’s low means all hope is lost for the bulls for today at least & signals further losses, probably as far as the 2315-2310 area & even 2300/2296 is possible. In fact I would not rule out these targets being hit before the close if we start to move lower, with increasing volatility in the last 2 weeks.
Silver XAGUSD
- Silver collapsed through my buying opportunity at 3100/3080 with stops triggered below 3050.
The break lower signalled a slide as far as a buying opportunity at 3010/3000.
This target was quickly achieved with a low for the day exactly here.
Longs need stops below 2970.
- Targets for our longs are 3055/60 & even 3095/99 is possible.
- However a break below 2970 is a sell signal for today, targeting 2930/25, perhaps as far as strong support at 2900/2890.
WTI Crude JULY future
- WTI Crude July I must wait for a signal, pattern or trend. Unfortunately for now there is nothing to go on as we jump about randomly & erratically in a sideways channel. I must wait for a breakout, pattern or signal.
- We are trading down towards recent lows at 7663/36, with a low for the day exactly here yesterday in fact….we may bounce before this area but as we have only traded sideways throughout May I am struggling now to find levels.
- A weekly close below 7600 could be a sell signal for the start of next week.
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