Gold GC-Mini Market Analysis
TheGold GC-mini has been trading sideways for the past 4 weeks. The bear bar put a damper on the bulls ambitions to get over the 5000 psychological price point this week. There is still a prominent tail beneath the bear bar, showing the presence of determined bulls trying to prevent another leg to the downside. Bears also failed to close the weekly bar beneath the moving average.
On the daily chart, bears put the past 4 consecutive bars beneath the moving average. We are clearly still in a more two-sided, trading range environment rather than a continuation of the straight-up parabolic move. The bears and bulls seem to be evenly matched to get the next leg up or down. Both sides are enjoying opportunities from a volatile market.
Bears need to follow through. Despite the recent down week, the bears have not yet achieved consistent, consecutive strong bear bars on the weekly chart. The market is still finding buyers at lower levels. Because of the historic strength of the trend, the first pullback is likely to be bought. However, given the intensity of the retracement, the odds of a second leg sideways to down are high.
If the bulls can push back above 4,800 and then 4,900, the trend resumes. If the bears can break decisively below the recent low of 4,626, it increases the likelihood of a deeper correction toward the 4,400–4,500 area. Until the market breaks out of the newly formed range, expect more trading range behavior.
The Weekly Gold chart
- Outside-inside bar sequence. This is a breakout pattern that can go either way.
- Bulls were able to prevent this week’s bar from closing beneath the moving average.
- Bears unable to close the body beneath last week’s body. Not a strong sell signal.
- Bears unable to close the body beneath last week’s body. Not a strong sell signal.
- Price remains inside a bull channel.
- Bears want to follow through with next week’s bar. Closing a bar on its low beneath the moving average.
- Bulls want to remain in an upward channel. Keeping the bar above the moving average.
- Bulls and bears continue to fight for market control regarding the highly psychological price of $5000.
- This week was an inside bear bar. Inside bars are triangles on smaller time frames. The middle of the triangle acts like a price magnet.
- This week’s bar was a bear doji. Doji bars are trading range bars.
- Bears were able to close the bar body beneath the 50% mark of the previous leg down. They are hoping to set up a 50% pull back sell signal.
- Bulls want to see a higher low form on the weekly chart, suggesting that the correction is over.
The Daily Gold chart
- After printing a bullish wedge and a nested wedge, the past 5 bars were downward.
- Tuesday and Wednesday’s bars were an outside-inside combination. This is a breakout pattern. The downside was tested for the duration of the week.
- Despite pushing downward, bulls bars printed 3 of the 5 days this week.
- The past 4 consecutive bars all closed beneath the moving average. This is good for the bears.
- The past 3 bars were sold off at the the test of the moving average.
- There are overlapping bars, range trading for the past 18 sessions.
- Of those 18 bars, only 6 bars have been bearish.
- The bull channel may be giving way to the bear flag.
- Bulls want to bring price back above the moving average, ideally closing consecutive bars above the moving average.
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