Gold analysis – 14 Oct 2019


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By: Ahura Chalki

Tensions do not disappear, they change from one form to another!

We had a great week past and going to have an interesting week ahead. Last week Gold was under pressure of economic data from one side and geopolitical tensions and trade talks from the other side. A short overview of what happened and what we do expect this week.

Last week’s main events were US-China trade talks, which finally ended with hopes and it was key market driver on last day of the week, however still we do not have a real and exact signed agreement. Brexit ended with positive hopes as well, though it was tied in the middle of the week, everything seems to change after Johansson and Varadkar (Irish PM) met on Thursday. While we were passing some parts of trade tensions, Geopolitical tensions came on the table with Turkish military invasion to Syria and Missile attack on Iranian tanker, and probably those new things change the game and Gold started recovering from its 10 days low at $1473, and now trading above $1487.

Along with important events, we have to keep in mind the economic data swell. Last week mostly we had negative data realized from the main economics of the world, especially from the US, which added the fears of likely recession, if banks especially do not take steps.

The week ahead will mostly about economic data and Wednesday with CPI data from New Zealand, UK, Italy, EU, and Canada, besides the US retail sale, it will be mainly and important day of the week.

Technical analysis:

Trading under 23.6 Fibonacci level ($1520), since September 25, while it did not touch that anymore with moistly trading under 32.8% Fibonacci, it seems it is so unlikely to get that levels back, soon again. Checking with the H4 chart confirms the $1497-8 as key and very important level, where 38.2% Fibonacci, EMA200,50 &20, all came together, while technical indicators all supporting the bears. As long as gold trading under this level, bears are in power.

Pivot point: 1487.70

Resistance levels: 1501.60 / 1517.05

Support levels: 1472.25 / 1458.35

Today the expected trading range is between 1458.35 support and 1501.60 resistance.

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