Gold Technical Analysis, July 28, 2020

Exclusive Markets Analysts
Exclusive Markets Analysts


Gold:


Technical Outlook:

Gold seems to be very close to topping or has topped around $1981 handle. The yellow metal is seen to be trading close to $1944/45 levels as we prepare this article, and is expected to turn lower anytime soon. A break below $1925 would confirm a potential bearish reversal.

Gold wave structure has changed according to the weekly chart after the metal rallied above $1920/21 yesterday. We have presented a probable count here: The entire drop between $1921 and $1046 since 2011 could be defined as Wave (A).

Earlier, we had presented a count of probable zigzag underway since $1920/21 in 2011. That count is ruled out for now and it remains possible for the metal to carve an expanded flat. An expanded flat is a 3-3-5 wave structure.

Also note that Wave B within an expanded flat travels above Wave A, which could be the case here. Gold drop from $1920 through $1046 still remains Wave (A) within the (A)-(B)-(C) expanded flat. The subsequent rally from $1046 through $1981 could be potential Wave (B).

If the above count is correct, Gold might turn lower from here and push through $1046 going forward. If not below $1046, we can expect a corrective drop at least. Keeping the above wave structure in mind, it would still be favoured to sell on rallies.

We may remain flat for a while and allow the metal to break below $1925 initial support. A counter trend rally thereafter should be taken as an opportunity to sell Gold.


Trading Strategy:

Allow break below $1925, then sell on rallies.

Legal Disclaimer: This article is not investment advice. The data provided is for marketing material purposes and is not intended to confuse nor guide our clients on trading decisions. Any investment activity performed is perceived to be a self-directed decision. Exclusive Markets is not liable for losses that may occur because of a decision made after reading the information published on our research page or any other media.

Risk Warning: Trading the capital markets is risky therefore further knowledge and experience may be required. Apply appropriate risk and money management always and ensure the implementation of safe leverage.

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