Bear Traps – Bullion Daily 24th 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

  • Impulsive selling as price action respect 2015 high to low 38.2% Fib level at 1205.95 which acted as strong resistance (1205 is also a key confluence zone that the bears are defending
  • Sellers dominate in this market and the price action seems to suggest old sellers trying to find new sellers here
  • Only a break and close above 1205 will alleviate the selling pressure
  • In the short term, gold will remain weak with support at 1172/1162 and 1155 levels
  • It will not surprise us to see a retest of the lower Bollinger band
  • A break and close below 1150 then expect lower prices to advance to 1050 and 1100 levels
  • Note the BB is converging tighter and we will not be surprise to see another short term range trading between 1205 and 1170 levels before a breakout
  • The bearish gartley remains a possibility but will be invalidated on a break below 1150

Daily Update

  • In our previous commentary, we highlighted that the MAs are rolling lower and another flush lower is still in the cards
  • Rejection of 20 DMA then look for a retest to previous low of 15.803 and then a possible target of 15.60 on the lower BB
  • Price action is currently stuck within a megaphone pattern but a break lower will target 15.60 and 15.30 levels
  • Short term expectation is for further weakness but if sellers fail to push lower then expect a squeeze

Daily platinum price action seems to indicate that a short term bottom is in at 1057.7 (this took out our weekly stop) and latest price action is trading inside the big red candlestick. A break and close above 1082.8 will get us to enter a long position. Our bias has changed to semi bullish and will wait for a confirmation in the next few days or weeks.

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

Daily Resistance levels:

  • 100 dma at 1142 / 50 at 1123 and 20 at 1093

Daily Support levels:

  • Lower BB line at 1057.7

The selling continues here and we are aware that price may soon need to retrace for a MA reconnect. Without a clear signal that the selling has abated and no divergence on the RSI, then sellers will continue to drive this market lower. However, we are monitoring the daily price action which is trading with an inside day and could long Palladium at 708.20 to play the corrective rally. Bearing in mind that it has been a sellers’ market and its RSI has reached extreme oversold territory – so a retracement is overdue.

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

Daily Resistance levels:

  • 200 dma at 779 / 100 at 771 / 20 at 738 / 50 at 762

Daily Support levels:

  • 690.2

Daily Update

Headline news continues to favour the dollar bull. Comments made by Fed Powell seem to deviate from Miss Yellen latest dovish speech. The caveat from the latest speech has certainly helped the dollar to stop running lower after 3 weeks of selling. Dollar index is effectively trading within a symmetrical triangle and price action RESPECT Fibonacci retracement on every swing high and low.

Current price action finds resistance at previous swing 38.2% and latest swing of 50% Fib which is the heavy confluence zone. In addition, the daily 20 and 100 ma 11881 and 11901 resides there which added weight to this resistance. Only a break above these levels will allow the bulls to target the upper channel of this triangle and with a possibility of moving higher.

The Elliott Wave count on a downside pressure often result in 5 waves while corrective rally is impulsive but looks checked to an ABC correction. Current price action could replicate such move as well.

Trade idea

Long @ 11839 – 11816 levels (what was support now resistance)

– assuming the retracement is B to complete

– An IHS formation could warrant higher prices

– Stop @ 11800

– Target @ 11924 – 11946 levels

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