Gold Technical Analysis, October 6, 2020

Exclusive Markets Analysts
Exclusive Markets Analysts


Technical Outlook:

Gold might be producing a counter trend rally which could extend up to $1925/30 levels before hitting resistance. Another alternative count suggests that the yellow metal could rally towards $1970/80 levels before reversing again. Bottom line is that $2075 should hold, going further.

Gold has confirmed a meaningful top in place already around $2075 levels. The yellow metal might have completed an impulse drop around $1848 before pulling back higher. It is trading around $1911 mark for now and close to resistance zone at $1925/30.

The probable counts are as follows: If Gold has completed its first impulse wave between $2075 and $1848, the metal might be setting up for a deeper corrective rally towards $1980 mark. We can expect a bearish reversal from there.

Alternately, if the drop is still incomplete, we might witness yet another drop below $1848 before a meaningful pullback could occur. For the alternate count to unfold, Gold must stay below $1975 potential resistance; also the wave 4 triangle termination.

Also note that a push above $1930/40 will confirm that Gold is pushing through $1975 levels in the near term. Either way, the metal remains in control of bears as long as $2075 resistance is intact. Only a push above $2075, would change the above bearish structure.

Gold remains a good candidate to be sold on rallies from here. The metal might drop to $1945 lows before producing a meaningful pullback but probabilities remain high for a temporary low in place around $1848.

Trading Strategy:

Short against $2075, target is open.

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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