Jump to content

Market update: XAU/USD flirts with breakout as retail traders turn more bearish


MongiIG

Recommended Posts

Gold prices climbed for another day, while retail traders turn more bearish and investors ponder an XAU/USD trendline breakout.

 

original-size.webpSource: Bloomberg

 
Daniel Dubrovsky | Currency Analyst, DailyFX, San Francisco | Publication date: Tuesday 19 September 2023 05:16

Gold sentiment outlook - bullish

Gold prices have rallied for a couple of trading sessions and retail traders have responded by increasing their downside exposure. This can be seen by looking at IG Client Sentiment (IGCS), which often functions as a contrarian indicator. With that in mind, will an increasing shift in retail exposure offer a warm welcome for the yellow metal?

The IGCS gauge shows that about 70% of retail traders are net-long gold. Since the majority of them are biased to the upside, this still could spell trouble for gold down the road. That said, downside exposure has increased by 9.49% and 3.59% compared to yesterday and last week, respectively. With that in mind, recent changes in exposure hint that the price trend may soon reverse higher.

IG Client Sentiment chart

 

original-size.webpSource: DailyFX

Gold technical analysis

On the daily chart, recent gains have pushed gold prices to flirt confirming a breakout above the falling trendline from May. Immediate resistance is the 1936.90 inflection point. A push above that exposes the 23.6% Fibonacci retracement level of 1971.63, opening the door to an increasingly bullish technical bias.

Otherwise, a false breakout places the focus back on the 38.2% point around 1903.46 before exposing the August swing low of 1884.37. Confirming a breakout under the latter opens the door to extending the downtrend since May.

XAU/USD daily chart

 

original-size.webpSource: TradingView

 

 

 

This information has been prepared by IG, a trading name of IG Australia Pty Ltd. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • image.png

  • Posts

    • KOSPI Composite Day Chart Analysis Elliott Wave Analysis by Trading Lounge Function: Counter Trend Mode: Corrective Structure: Gray Wave 2 Position: Orange Wave 3 Next Higher Degrees Direction: Gray Wave 3 Wave Cancel Invalid Level: 2551.59 The KOSPI Composite day chart analysis employs Elliott Wave Theory to provide a detailed examination of market movements. The primary function of the current movement is a counter trend, indicating a move against the primary trend. Mode and Structure: The current mode is corrective, indicating a retracement or consolidation. The structure analyzed is Gray Wave 2, a corrective wave within the larger Elliott Wave framework. Current Position: The market is currently within Orange Wave 3, the third wave of a higher-degree sequence in the orange wave category. According to Elliott Wave Theory, Wave 3 often shows strong, impulsive characteristics. Next Higher Degrees: The direction for the next higher degrees is towards Gray Wave 3. After completing the corrective phase of Gray Wave 2, the market is expected to transition into Gray Wave 3, which is anticipated to be an impulsive wave, resuming the primary trend direction. Details: Following Gray Wave 1, the market is now in the corrective phase of Gray Wave 2 of 3. This phase is crucial as it sets up the market for the next significant move, Gray Wave 3 of 3. Gray Wave 2 is a preparatory phase leading to the next impulsive phase. Wave Cancel Invalid Level: The critical wave cancel invalid level is set at 2551.59. If the market falls below this threshold, the current wave analysis would be invalidated, requiring a reevaluation of the wave count. Summary: The KOSPI Composite day chart indicates that the market is in a corrective phase, identified as Gray Wave 2 within Orange Wave 3. The next expected move is a transition into Gray Wave 3, which is anticipated to resume the primary trend. The wave cancel invalid level is set at 2551.59, serving as a key point for validating or invalidating the current wave structure.   KOSPI Composite Weekly Chart Analysis Elliott Wave Analysis by Trading Lounge Function: Trend Mode: Impulsive Structure: Orange Wave 3 Position: Navy Blue Wave 3 Next Lower Degrees Direction: Orange Wave 4 Wave Cancel Invalid Level: 2551.59 The KOSPI Composite weekly chart analysis utilizes Elliott Wave Theory to understand market behavior. The function of the current movement is identified as a trend, indicating alignment with the primary direction of the established trend. Mode and Structure: The current mode is impulsive, suggesting strong, directional market moves. The structure under analysis is Orange Wave 3, a significant and typically powerful wave within the broader Elliott Wave sequence. Current Position: The market is currently within Navy Blue Wave 3, a major phase in the market cycle characterized by substantial moves and increased trading activity. Next Lower Degrees: The direction for the next lower degrees is towards Orange Wave 4. After completing the impulsive phase of Orange Wave 3, the market is expected to enter a corrective phase, identified as Orange Wave 4, which will likely retrace some gains made during Orange Wave 3. Details: Orange Wave 2 appears to be completed, setting the stage for the current phase, Orange Wave 3 of 3. This phase is crucial as it represents a strong, impulsive move within the broader trend, often marked by significant price movements and increased volatility. Wave Cancel Invalid Level: The critical wave cancel invalid level is set at 2551.59. If the market falls below this threshold, the current wave analysis would be invalidated, necessitating a reevaluation of the wave count. Summary: The KOSPI Composite weekly chart analysis indicates that the market is in an impulsive phase, identified as Orange Wave 3 within Navy Blue Wave 3. The next expected move is a transition into Orange Wave 4, which will be a corrective phase. The wave cancel invalid level is set at 2551.59, serving as a key point for validating or invalidating the current wave structure.   Technical Analyst : Malik Awais Source : Tradinglounge.com get trial here!  
    • EURUSD Elliott Wave Analysis Trading Lounge Day Chart Euro/ U.S. Dollar (EURUSD) Day Chart EURUSD Elliott Wave Technical Analysis Function: Counter Trend Mode: Corrective Structure: Orange Wave 2 Position: Navy Blue Wave 3 Next Higher Degrees Direction: Orange Wave 3 Details: Orange wave 1 appears completed, and orange wave 2 is currently in play. Wave cancel invalid level: 1.06657. The EURUSD Elliott Wave Analysis on the day chart provides insights into market behavior using Elliott Wave Theory. The primary function of the current market movement is identified as a counter trend, indicating that the market is moving against the primary trend direction. The mode of this movement is corrective, suggesting the market is experiencing a retracement or consolidation phase rather than a strong directional trend. The specific structure under analysis is orange wave 2, a corrective wave within the broader Elliott Wave framework. The current position of the market is within navy blue wave 3. This analysis focuses on the third wave of a higher-degree sequence within the navy blue wave category. Wave 3 in Elliott Wave Theory is typically significant, often exhibiting strong and impulsive characteristics. For the next higher degrees, the direction is towards orange wave 3. Following the completion of the current corrective phase of orange wave 2, the market is expected to transition into orange wave 3. Orange wave 3 is anticipated to be an impulsive wave, resuming the primary trend direction. The analysis notes that orange wave 1 appears completed. Orange wave 1 represents the initial impulsive move in the sequence. Currently, the market is in the corrective phase of orange wave 2. This phase is critical for setting up the subsequent major move, which will be orange wave 3. An essential aspect of this analysis is the wave cancellation invalid level, identified as 1.06657. This level serves as a threshold; if the market moves below this point, the current wave analysis would be invalidated, necessitating a reevaluation of the wave count. In summary, the EURUSD day chart analysis indicates the market is in a corrective phase, identified as orange wave 2 within navy blue wave 3. The next anticipated move is a transition into orange wave 3, expected to resume the primary trend. The wave cancel invalid level is set at 1.06657, serving as a critical point for validating or invalidating the current wave structure.   EURUSD Elliott Wave Analysis Trading Lounge 4-Hour Chart Euro/ U.S. Dollar (EURUSD) 4-Hour Chart EURUSD Elliott Wave Technical Analysis Function: Counter Trend Mode: Corrective Structure: Orange Wave 2 Position: Navy Blue Wave 3 Next Higher Degrees Direction: Orange Wave 3 Details: Orange wave 1 appears completed, and orange wave 2 is currently in play. Wave cancel invalid level: 1.06657. The EURUSD Elliott Wave Analysis on the 4-hour chart provides insights into the market using Elliott Wave Theory. The primary function identified is counter trend, indicating that the market is currently moving against the primary trend. The mode of this movement is corrective, suggesting the market is undergoing a retracement or consolidation phase rather than a strong directional move. The specific structure in focus is orange wave 2, a corrective wave within the Elliott Wave framework. The market position is identified as navy blue wave 3. This means the analysis is examining the third wave of a higher-degree sequence within the navy blue wave category. Wave 3 is typically significant in Elliott Wave Theory, often associated with strong and impulsive movements. The direction for the next higher degrees is orange wave 3. Once the current corrective phase of orange wave 2 is complete, the market is expected to transition into orange wave 3. Orange wave 3 is anticipated to be an impulsive wave, resuming the primary trend direction. The analysis details that orange wave 1 appears completed. Orange wave 1 represents the initial impulsive move in the sequence. Now, the market is in the corrective phase of orange wave 2. This phase is essential for setting up the next major move, which will be orange wave 3. A critical aspect of this analysis is the wave cancellation invalid level, identified as 1.06657. This level acts as a threshold; if the market moves below this point, the current wave analysis would be invalidated, suggesting a reevaluation of the wave count is necessary. In summary, the EURUSD 4-hour chart analysis indicates that the market is in a corrective phase, identified as orange wave 2 within navy blue wave 3. The next anticipated move is a transition into orange wave 3, which is expected to resume the primary trend. The wave cancel invalid level is set at 1.06657, serving as a crucial point for validating or invalidating the current wave structure.   Technical Analyst : Malik Awais Source : Tradinglounge.com get trial here!  
    • COCHLEAR LIMITED - COH Elliott Wave Technical Analysis (1D Chart) Greetings, Our Elliott Wave analysis today updates the Australian Stock Exchange (ASX) with COCHLEAR LIMITED - COH. We observe that COH has concluded wave ((4)) - navy as a Triangle, and wave ((5)) - navy is poised to advance. ASX: COCHLEAR LIMITED - COH Elliott Wave Technical Analysis 1D Chart (Semilog Scale) Analysis Function: Major trend (Primary degree, navy) Mode: Motive Structure: Impulse Position: Wave ((5)) - navy Details: Wave ((4)) - navy seems to have ended at the low of 318.39 as a Triangle, and wave ((5)) - navy is unfolding to move higher, targeting around 386.63 - 400.00 or beyond. The invalidation point is 318.39.   ASX: COCHLEAR LIMITED - COH Elliott Wave Technical Analysis (4-Hour Chart) 4-Hour Chart Analysis Function: Major trend (Primary degree, navy) Mode: Motive Structure: Impulse Position: Wave ((5)) - navy Details: Wave ((4)) - navy has just concluded at the low of 318.39 as a Triangle, and wave ((5)) - navy is likely to push higher, provided the price remains above 318.39. The target is 400.00 or beyond. The invalidation point is 318.39.   Conclusion Our analysis, forecast of contextual trends, and short-term outlook for ASX: COCHLEAR LIMITED - COH aim to provide readers with insights into current market trends and strategies to capitalize on them effectively. We offer specific price points as validation or invalidation signals for our wave count, enhancing the confidence in our perspective. By combining these factors, we strive to offer readers the most objective and professional market trend analysis. Technical Analyst: Hua (Shane) Cuong, CEWA-M (Master’s Designation). Source : Tradinglounge.com get trial here!  
×
×
  • Create New...
us