Dump & Pump? – Bullion Daily

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

Gold rallied after the release of US GDP numbers but failed to close above the wedge at 1095 level

Lower time frame shows that price has broken below the wedge but will need confirmation of further selling

Break below the wedge, we could target 1040.60

Only a break above 1110 will we see a brief period of short covering to fill gap to 1130

Rallies to 20 ma will act as resistance and sellers should appear

On the contrary, dollar index is on resistance and the yellow metal may have some catalyst to relieve the selling

Resistance now at 1122 1138 and 1154 so watch for the 20 MA to add the extra confirmation to short

Caution end of month book squaring – could see a fail dump then spiked higher today

Daily Update

A feeble attempt to break higher but silver failed as more selling appears at the ned of the trading hours

We will not rule out a possible dump and pump action in the near future

The balance has shifted in favour for bargain hunters to build short term long exposure

Price action still within a downward sloping channel but key support at the rising trend line at 14.60 (break this then 13.99 is possible)

Not ruling out a retest lower to 14.25 and 13.99 for a double bottom

Daily RSI is showing sign of divergence but relief rally are selling opportunities unless we close and break above 20 ma

Price broke out of the wedge formation and continuous selling prevail – suggesting that further selling could be in the cards. Yes the RSI is heavily oversold but only if we see a strong green candles and bargain buying, then platinum remain weak. The 20 ma will continue to act as resistance and only a strong green candle can overcome the selling momentum. As mentioned in our previous report – only if we see improvement fundamentally in the global demand for automakers – expect lower platinum prices.

Once again, palladium is sold and broke below the wedge – expect further short term weakness but looking to enter a small long on a RSI rebound. Next price action could see a retest of previous low to act as a double bottom. Otherwise, a break lower to 580 is still possible. Only a close and break above the 20 ma will give rooms to test higher prices. We are watching at the weekly potential inside day pattern that should see short covering if price breaks and close above 640.

Advertisements

Inter Market Analysis – New Format

Risk On

  • Asian shares inched higher for Friday but post a loss for the month
  • Dollar index hit a possible triple top – Is this temporary or a top is in?
  • US GDP growth was revised higher for Q1 and Q2 growth came in below expectation but it is still growing
  • Grexit under the carpet for now – Tsipras fighting local battle
  • Dollar strength continues on the back of an imminent rate hike – this is not priced in yet?
  • Pre-election euphoria on recovering economy such as Spain and Ireland

Risk Off

  • Japanese economic data shows a drop in household spending – inflation in danger? Will BOJ do more easing?
  • Japanese economic data shows a rise in June jobless rate – slowdown in the economy?
  • Chinese authorities go the extra length to clamp down trading accounts that have abnormal bids – no more spoofing?
  • Imminent rate hike by the Fed – rate hike tantrum has not set in yet?
  • Has the global economy priced in the potential impact of Chinese equity rout?
  • Puerto Rico nears default as debt restructuring beckons
  • Commodities continue to struggle – gold propelled higher with the dollar but closed lower
  • New Zealand business confidence is at -15.3 against previously -2.3 – need more easing?
  • Australian PPI QoQ comes in lower but YoY is higher
  • German Retail sales comes in lower MoM
End of the month book squaring and positioning for August – market priced in all the negative news – market favour a risk on approach?

Multi Time Frame Analysis

USD Index

Daily

4 hour

Daily chart shows a persistent dollar bull – any setback is a buying opportunity on the promise of an imminent rate hike. Watching how the RSI has begun diverging as well . One would have thought that this has all been priced in? 4 hour chart shows a potential triple top formation.

German Bund

Daily

4 hour

Lower time frame has signalled an RSI divergence but the daily price momentum continue to grind higher within this ascending triangle. We cannot rule out that this action could continue but are aware that the daily resistances are coming to play – confluence of resistance such as upper Bollinger band, 100 and 200 ma as well as a potential double top.

If Bunds come to resistance, expect EUR/USD to come to support and potentially a viable trade to long Euro if and when dollar hit resistance and create a swing high failure.

Eur/Usd

Daily

4 hour

Daily chart shows a strong support area for Euro to bounce and continue to trade within an ascending triangle pattern. The 4 hour structure will need to break above the red channel line to retest higher. With the dollar and bunds at resistance, the Euro may look favourable again.

Dax

Daily

4 hour

Resistance stands at 20 ma and the 50% fib from last week high to this week low. A potential bear flag formation and a break below will target the lower daily Bollinger band for a potential support and a double bottom formation.

Yellow Gloomy Bars – Bullion Daily

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

Break below the wedge, we could target 1040.60

Only a break above 1110 will we see a brief period of short covering to fill gap to 1130

Rallies to 20 ma will act as resistance and sellers should appear

On the contrary, dollar index is on resistance and the yellow metal may have some catalyst to relieve the selling

Resistance now at 1122 1138 and 1154 so watch for the 20 MA to add the extra confirmation to short

Caution end of month book squaring – could see a fail dump then spiked higher today

Daily Update

Price action still within a downward sloping channel but key support at the rising trend line at 14.60 (break this then 13.99 is possible)

Not ruling out a retest lower to 14.25 and 13.99 for a double bottom

Daily RSI is showing sign of divergence but relief rally are selling opportunities unless we close and break above 20 ma

Price action is still trading within the big red candle that created the 2015 low. A wedge formation – often a continuous pattern so we cannot rule out a retest at previous low again. The 20 ma will continue to act as resistance and only a strong green candle can overcome the selling momentum. As mentioned in our previous report – only if we see improvement fundamentally in the global demand for automakers – expect lower platinum prices.

Palladium continue to consolidate after putting in a new low and we continue to have the RSI diverging. Price action is still trap within the downward channel and resistance at 20 ma is selling opportunities. Only a close and break above the 20 ma will give rooms to test higher prices. We are watching at the weekly potential inside day pattern that should see short covering if price breaks and close above 640.

Inter Market Analysis – 30th July

Equity

Risk On

  • Baidu announced a 12 months buyback programme worth 1 billion
  • Asian shares tipped higher on the back of dovish Fed statement
  • Cost cutting seasons with Shell and Centrica on the headline
  • Nokia in surprise profit

Risk Off

  • Australia building approvals m/m came worse than expected -8.2

Outlook: Post FOMC dovish statement, US GDP forecasted to come in better than expected

Biased: End of the month book squaring – positioning for a possible rate hike tantrum into August? Β Β 

Currencies

  • Turnaround dollar despite dovish statement – found support and held – Dollar remains king
  • Commodities currencies continue to suffer the headwinds
  • Yen weakness continues – helped Japanese exports favourable – Nikkei agrees

Outlook: Opportunity for a rate hike by Miss Yellen put into question but most likely a September hike

Biased: Expect US GDP to create market volatility as we approached end of the week Β 

Bonds

  • Given Euro weakness, Bunds continue to enjoy higher prices. However, we are threading into potential resistance on the Bunds and a long Euro trade is viable soon

Outlook: Break above 154.22 will be impressive but watch out for daily ma resistance at 100 and 200. In addition, we have 50% fib retracement confluence in that area.

Biased: Bunds look exhausted after an impressive run higher that we envisaged but there are rooms higher still

Commodities

  • We have had a retest of lower low on several commodities
  • Various commodities reached oversold territory but without any sign of reversal – rallies are selling opportunities

Outlook: Watch the dollar index closely for clues while commodities continue to struggle

Biased: Rallies continue to be selling opportunities

Watch list

USD index

Dollar found support at 20 ma after the kneejerk reaction at 12063 – watch that the RSI is diverging after dollar hit resistance and has made lower low and lower high. Is this a potential sign of a topping pattern?

German Bund

The lower timeframes on the Bund suggest short term weakness ahead of resistance. Can it break above previous high of 154.22? Possible yes and break higher to 50% fib and 200 ma coming in as confluence where we look to setup a short.

Copper

Lack of global demand and potential tightening in the US does not help Copper prices. Power house such as China continue to struggle. Only a break above the orange downtrend line will give buyers some confidence. Otherwise, sellers continue to dominate the copper market.

German Dax

Dax filled up previous gaps as envisaged in our write up – post Greece Euphoria – Chinese stimulus – concern about rate hike have all been priced in. Current chart setup shows a bearish wedge and a retest of 200 ma is in the cards. We will not rule out a retest on the lower BB line. Resistance stands at 20 ma and the 50% fib from last week high to this week low.

Inter Market Analysis 22nd July

Equity

Risk On

Risk Off

  • Italy retail sales -0.1 vs 0.0
  • Overnight thin trading post earning had US equities slumbering lower
  • Asian shares lower Greek parliament continues vote on bailout
  • Joblessness clouds Spanish economic rebound
  • Poor Apple after hours result alongside Yahoo and Microsoft

Outlook: As per yesterday outlook, equities such as Apple’s earnings was affected by China recent and potential slowdown

Biased: Risk Off as market try to digest the implication of hard landing in China after the β€œblip” on the 2nd largest economy stock market Β 

Currencies

  • Retracement on the dollar after turn around Tuesday
  • Dollar found support and the rally could consider further regardless
  • Euro caught some bids and Sterling open strong on MPC minutes
  • More easing expected from export economy as commodity prices are hard hit

Outlook: Hawkish Yellen and Carney – dovish BOC / RBA / RBNZ / BOJ

Biased: With Greece resolved is there any more need for safe haven currency? No is the answer on Yen while dollar and sterling could still go higher

Bonds

  • With the dollar on the back foot = euro could attempt higher prices = bunds lower

Outlook: We continue to envisage higher bunds in the short term and pullback remains buying opportunity

Biased: Set to test higher as long as support at 20 and 50 ma holds

Commodities

  • A retest of the new low on several commodities in the next few days is possible
  • Talk of lower commodity prices to further hurt export economies (AUS / NZD / BOC) further easing expected?

Outlook: No reversal as of yet and expect further bout of weakness but look out for bargain hunters

Biased: After the sell off – consolidation and retest of the new low? Let the dust settle first Β 

Watch list

USD index

Price action is converging tighter while resistance of April swing low still there. Only a break above will clear the air for more upside potential. The selloff looks like an opportunity for dollar bull to build their position. There is no damage on the uptrend channel and instead, we could see a bounce here. Support comes at 20 ma as well and the 100 ma.

German Bund

The lower timeframes on the Bund suggest short term weakness ahead of resistance. Can it break above previous high of 154.22? Possible yes and break higher to 50% fib and 200 ma coming in as confluence where we look to setup a short.

Copper

The selling is not over yet as previously mentioned, copper tanked lower so a retest of previous low is possible. With China stock market struggling, rate hike in US imminent – demand for copper could be in taper tantrum. Bounce is selling opportunity.

German Dax

1 out of 3 gaps filled and we are in the process of possibly filling the next gap by end of the week. The above daily chart shows Dax hit resistance and after US equities took a knock, Dax gapped lower and looks at 20 ma as a potential magnet for support and previous channel. Gaps below remain unfilled and we will not rule out at least 2 out 3 gaps should be filled but on this weekly chart a potential retracement to 319 and a rebound is possible.

Margin Calls – Bullion Daily 21st July

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

Resistance now at 1122 1138 and 1154 so watch for the 20 MA to add the extra confirmation to short

Big resistance from the H & S formation stands at 1155 area

Will not rule out a retest of previous low at 1071 and even lower

Expect period of consolidation but rallies are short selling opportunities

RSI has reached oversold territory-no divergence yet on daily

Unless breakout level at 1130 heavily defended by the short then possible short covering to target 1155

Daily Update

We covered the weakness in silver and slightly amazed the selloff was not as rapid as gold (though we have one explanation that trade positioning is in play here with speculative long and shorts)

Price action still within a downward sloping channel but key support at the rising trend line at 14.60 (break this then 13.99 is possible)

Not ruling out a retest lower to 14.25 and 13.99 for a double bottom

Daily RSI is showing sign of divergence but relief rally are selling opportunities unless we close and break above 20 ma

We have an inside day with the candle piercing the lower end of the Bollinger band (possible reversal signal?)

Further weakness and sell off prevailed and price broke lower than our anticpated 962 target. We have another inside day pattern here and daily RSI has hit oversold territory but could have more rooms to go lower. We are not ruling out that platinum may retest the 2015 low as support and we are not discounting the possibility that this could be the low of the year which could be key for a relief rally. As long as the automakers see pick up in demand, stockpiling platinum at this price could be well worth it. In the short term, rallies are selling opportunity.

So we hit below 599.9 as written in our report last week. There is some bargain hunting around this price levels as the RSI continue to diverge. However, we are not ruling out a retest of low and even 578.8 dump then pump action. Unless price break and close above 20 ma then any rallies are selling opportunity.