Dovish Till Next FOMC – Bullion Daily 18th June

Bullion Daily

The following information is a guideline (trading plan) and should not be treated as financial advice. Not advice but banter and active in sharing trade ideas via twitter @sugardaddyFED. You can also follow us via TradingView.com for the latest charts update.

Daily Update

  • Yes we are still trading within a tight range and thanks to Miss Yellen dovish remark we have a green candle
  • Note, the market tried to find fresh sellers but fail thus the long wicks
  • Goldman Sach has pushed a possible rate hike to December rather than September
  • With the US economic projection curtailed, the long dollar camp retreated
  • Only a break and close above 1205 and 1216 will indicate a bullish reversal
  • Bollinger band is converging for a potential breakout (check out the weekly chart BB!)
  • RSI has not reach oversold territory yet and bounced higher
  • Don’t be surprise if price stall at 1205 with daily RSI stuck at 60
  • We are not ruling out another month of range trading

Daily Update

  • We have to point out the resilient silver as it holds above 15.80 levels
  • After Yellen’s dovish comment, a short term support at 15.80 is cemented
  • We are on a corrective rally here and targets are 16.54 and 16.78
  • The RSI has bounced off higher and gains are kept
  • Any rejection from the targets aforementioned, silver could revisit the lows
  • We will continue to monitor the price action and should it close and hold above 20 DMA, then a long position can be initiated
  • Our medium term view is still bearish

We have covered all our short positions and will wait for another signal to short Platinum. The short term picture could play a corrective rally given the dovish comment from Miss Yellen. Should the corrective rally play out, then a revisit to 1111 and 1124 could be in play and any rejection off 1124 could give a great risk reward to short platinum again. Take note that the daily Bollinger band is tightening again while the RSI did bounce off the area we marked. Note that we are not arguing at the possibility that Platinum could embark on a strong rally from here on. It is possible but until we have a clearer picture, we maintain the bearish stance.

Below are key levels that we will continue to monitor and this will change depending on price action.

Daily Resistance levels:

  • 100 dma at 1149 / 50 at 1131 and 20 at 1106

Daily Support levels:

  • Lower BB line at 1071

We hit the 720 target and price actually broke below and made a new low at 716.6. Short term support should hold here and we need a bounce as the daily candle sticks are potentially creating an inside day formation. Often, an inside day in palladium gives a clear signal of a reversal but we will remain cautious and wait for a clear confirmation. Current price action continues to favour sellers. Note that the Daily RSI has hit oversold area but has not made any divergence.

Below are key levels that we will continue to monitor and this will change depending on price action.

Daily Resistance levels:

  • 200 dma at 782 / 100 at 774 / 20 at 755 / 50 at 768

Daily Support levels:

  • 716.6

Daily Update

– 4 hourly Head & Shoulder pattern is playing out

– Head at 97.50 and neckline was at 94.84, giving a distance of 2.66

– Target for the H&S is at 92.18 which hits the 38.2% Fib retracement from the 2014 rally

– Current PA we have minor support on the trendline then with key support at 93.13

– Break below 93.13 opens up more selling where price will look for support from 200 DMA that is rising (92.08)

– MACD is still crossing lower and the RSI has rooms as it is not oversold yet

– PA is trading well below the 20 DMA which suggest sellers are in control

– Rallies are to be sold

– 50 MA cross below 100 MA = death cross

FA

– Dovish statement from the last FOMC meeting

– Data dependant and revision of a weaker US economy

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