VOT Research Report
Analytics and Recommendations
- A triple bottom causes gold to rebound.
- When the price breaks above $1,730/oz, sentiment improves.
On Tuesday, the precious metal easily overcame resistance levels as the US dollar fell due to speculation that the Federal Reserve may scale back its rate hike in December. A 50 bp hike is now more likely than a 75 bp hike, according to the most recent market pricing, which is due to Fed speakers starting to tone down their strong hardening language.
The US dollar is returning in a support area that has maintained for the past two months, according to the daily chart of the US dollar. The US dollar has been unable to break higher since the end of September, and the short-term trend remains bearish. Support is still present, indicating that the short- to intermediate US dollar may get stuck in a contracting band.
Tuesday saw a new one-month high for gold as the US dollar weakened and found support. Since last Thursday, when the precious metal rebounded from support, gold has increased by about $100/oz. This is the third time this level has held in the previous six weeks. The multi-month decline is under pressure, giving the daily chart a more encouraging appearance. The recent string of lower highs would be broken with a close and open above $1,730/oz, leaving $1,766/oz as the next upward objective. Initial support lies between $1,682 and $1,676 per ounce.
According to data from retail traders, 73.58 percent of traders are net long, with a long-to-short ratio of 2.79 to 1. The number of traders who are net-long has decreased by 8.71% from yesterday and by 17.20% from last week, while the number of traders who are net-short has increased by 2.14% from yesterday and by 47.14% from the previous week.
The fact that traders are net-long signals that gold prices may continue to decline. We normally take a contrarian stance against the attitude of the crowd. However, traders are less net-long today than they were yesterday and last week. Even while traders are still net-long, recent shifts in attitude indicate that the present upward trend in the price of gold may soon reverse.
Simple Moving Averages
|
Name |
MA5 |
MA10 |
MA20 |
MA50 |
MA100 |
MA200 |
|
1683.23 |
1666.17 |
1658.56 |
1678.48 |
1718.98 |
1806.43 |
Pivot Points
|
Name |
S3 |
S2 |
S1 |
Pivot Points |
R1 |
R2 |
R3 |
|
Classic |
1708.39 |
1709.57 |
1710.69 |
1711.87 |
1712.99 |
1714.17 |
1715.29 |
|
Fibonacci |
1709.57 |
1710.45 |
1710.99 |
1711.87 |
1712.75 |
1713.29 |
1714.17 |
|
Camarilla |
1711.17 |
1711.38 |
1711.59 |
1711.87 |
1712.01 |
1712.22 |
1712.43 |
|
Woodie’s |
1708.35 |
1709.55 |
1710.65 |
1711.85 |
1712.95 |
1714.15 |
1715.25 |
|
DeMark’s |
– |
– |
1711.27 |
1712.16 |
1713.57 |
– |
– |
Technical Indicators
|
Name |
Value |
Action |
|
RSI(14) |
59.909 |
Buy |
|
STOCH(9,6) |
48.686 |
Neutral |
|
STOCHRSI(14) |
0.000 |
Oversold |
|
MACD(12,26) |
5.810 |
Buy |
|
ADX(14) |
15.087 |
Neutral |
|
Williams %R |
-66.390 |
Sell |
|
CCI(14) |
-60.9747 |
Sell |
|
ATR(14) |
3.3393 |
Less Volatility |
|
Highs/Lows(14) |
-0.0858 |
Sell |
|
Ultimate Oscillator |
49.473 |
Neutral |
|
ROC |
-0.265 |
Sell |
|
Bull/Bear Power(13) |
1.0540 |
Buy |
|
Buy: 3
Sell: 4 Neutral: 3 Summary: SELL |
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