Fundamental Analysis

• U.S. stock indices marked seven consecutive gains with optimism from the end of the U.S. Federal Reserve’s rate hike cycle, pushing stocks higher.
• Crude oil prices fall sharply, forming a large head-and-shoulders pattern.
• Gold is on a downward trend as risk-averse behavior diminishes.

XAUUSD Technical Analysis

Analyzing the daily chart for gold markets. It falls below the 10-day moving average, indicating a clear downward trend. Failing to surpass the USD 2,000 milestone, selling pressure increases. Notably long lower shadows between USD 1,950 and USD 1,960 suggest this range is acting as a support zone.

The neckline is at USD 1,954, and breaching this level could increase the risk of falling to USD 1,935, where the 61.8% Fibonacci retracement lies. The current price movement is dominated by sellers, yet a rebound from buyers near the support zone should be monitored.

Day Trading Strategy (Hourly)

Analyzing the 1-hour chart for the gold market. The RSI climbs to 45 and exceeds the 10-day moving average, indicating a clear upward trend. A strong USD limits the rise in gold prices, but a cautious stance by the Fed on additional rate hikes could turn out to be a positive factor for gold.

After a sharp rise followed by a correction sell-off, signs of an upward trend reemerge. Even as funds flow into the stock market, the appetite for investing in gold remains undiminished.

The day trading policy would be to buy on dips at USD 1,955, with a target price for settlement at USD 1,975, and a stop-loss line at USD 1,950.

Support and Resistance Lines

The resistance line to be considered in the future is as follows

1,954 USD … Neckline

Market Sentiment

XAUUSD　Sell: 50% Buy: 50%

Today’s Important Economic Indicators

*Trading advice in this article is not provided by Milton Markets, but by Shu Fujiyasu Jr., a certified technical analyst.