Gold on an Upward Trend, Battle Between Profit-Taking and Dip Buying【October 17, 2024】

Fundamental Analysis

• Gold has declined following a rise in interest rates due to U.S. employment statistics and inflation rates.
• Despite the situation in the Middle East raising demand for safe-haven assets, there remains a seasonal anomaly where gold tends to be bought towards the end of the year.

XAUUSD technical analysis

Let’s analyze the daily chart for gold. Gold has maintained an upward trend, and although it hasn’t reached a new high, it is nearing the previous peak with significant momentum. Currently, it is trading around 2675 USD. The 10-day moving average is approaching the 26-day moving average, and the key question is whether gold will rebound from here.

If the upward trend continues, there is a strong possibility that gold could test the 2700 USD level. From a broader perspective, gold is maintaining an ascending channel, and a pullback is likely when it reaches the upper limit of the channel.

With the upcoming presidential election, the market remains nervous. The “Mochi Tora” risk should be closely monitored.

Day trading strategy (1 hour)

Let’s analyze the 1-hour chart for gold. Recently, the 10-day moving average has acted as a support level, leading to a rebound. Analyzing the RSI, we see a rebound from the 50 level, with the upward trend slowly resuming. There is a notable engulfing pattern around the 2685 USD mark, indicating strong profit-taking activity. Market sentiment also shows a rise in sell positions.

However, if gold breaks through 2685 USD, a series of stop-loss orders might be triggered, potentially accelerating the upward trend more than expected.

For day trading, the market is tricky, but it may be worth considering a buy position. Ideally, positions should be taken around 2670 USD. The target would be 2685 USD and 2700 USD. A stop-loss should be set at the recent low of 2665 USD on the 1-hour chart.

Support/Resistance lines

The following support and resistance levels should be considered going forward:

• 2740 USD: Monthly resistance line
• 2563 USD: Weekly Fibonacci 161.8%

Market Sentiment

XAUUSD: Sell: 62% Buy: 38%

Today’s important economic indicators

*Trading advice in this article is not provided by ミルトンマーケッツ, but by Shu Fujiyasu Jr., a certified technical analyst.