Gold/USD | Gold is building strength in consolidation | 13 November, 2020
Gold Price Forecast relative to
Long Term Monthly (LT-M) – Medium Term Weekly (MT-W) – Short Term Daily (ST-D) – and Hourly (not shown) data.
(Previous week in brackets)
|Au Trend||↓ (↓)||↓ (↓)||↑ (↑)|
|Au % Risk
|73 (75)||25 (32)||22 (77)|
Total allocation 50% (50%)
Gold/USD live price
Gold shows good solid strength
13 November:: One thing we’ve learned from history; markets always return to their sensible levels. Multi time frame technical analysis allows us to stay away from high risk situations even if major opportunities are missed as a result. So far so good. Gold tanked on Monday because Viagra producer Pfizer reported a 90% success rate from their 3rd stage Corona Vaccin trials. Daily risk on Gold dropped sharply last week from 77 to 22 with Weekly at 25 now developing bullish divergence versus Monthly, at 73, risk. We have consolidated around the 2011 peak now for 16 weeks. The mostly likely next major move is ‘up’ looking for technical bearish divergence to develop in both Medium and Long term time frames. This will take many months to materialize. In the meantime, the ECB this week confirmed their unchanged ‘whatever it takes’ multi trillion Euro policy, mirroring Fed policy. Full hold, no Change.
06 November:: Spot Gold/USD was firm all week closing near the highs at 1948. Last week’s relative bullish divergence between Daily and Weekly versus Monthly played out, although the daily risk level increased substantially towards the 75-80 level. Bullish divergence at this week’s close is developing in the Weekly time frame versus Monthly which is a bullish risk pattern whilst the price holds around and above the 2011 peak. Our uninflated initial objective is 2450 drawing a parallel line through the 2011 peak to the 2004-2018 support line. We do expect an inflated (log scale) price level to develop over time could which will largely be determined by future monetary conditions and proof of unsustainable debt levels coupled with QE to infinity.
Gold/Euro live price
13 November:: Gold dropped against Euro roughly nby the same margin as agaist USD and showing the same bullish long term technical picture across RSI, MACD and Stochastic tools.
06 November:: At 1628 Gold/Euro is holding and consolidating very nicely with a similar linear chart parallel resistance at 1800 based on price pattern as Gold/USD whilst the first Fibo objective sits at 2097. Gold vs Euro is a hold.
Gold/British Pound live price
13 November:: GBP was relatively strong in the currency space last week. The picture otherwise hasn’t changed with Gold looking strong long term as Medium and Short term tools develop bullish divergence vs Long term. No Change.
06 November:: GBP funnily enough looks stronger against Gold than USD or Euro, yet the Weekly divergence versus Monthly that now develops (change periods in chart below) make Gold looking quite strong vs GBP and we expect to start looking at a log scale chart sometime during the next 12 months as sterling weakness into a similar inflationary spiral seen between 1970 and 2000. Gold is a hold for Sterling based investors.