Technical glance: Gold’s ( XAUUSD price) has been attempting to spike above 7 & 21-DMAs after hammer and dragonfly doji patterns at $1,292 and $1,291.42 levels respectively.
It has continued to sense buying sentiments after yesterday’s break-out of stiff resistance above 1,298.49 and 21-DMA levels (on the daily chart ).
To substantiate this bullish sentiment, both the leading oscillators show upward convergence to the prevailing rallies that indicate the strength and the intensified buying momentum.
While trend indicators yet to confirm, though we see bullish MACD crossover on this timeframe.
On a broader perspective, double top with consecutive shooting stars nudges price below EMAs on monthly plotting. To counter these slumps, ever since the formation of hammer pattern at $1,200.55 levels in Aug’2018 (exactly at double top neckline) we’ve seen more upswings, On the contrary, shootings star pops-up again at $1,313.01 level that puzzles the major trend.
The hammer on daily terms is hampering the chances of forming a triple top pattern on the monthly terms.
Both momentum oscillators ( RSI &Stochastic curves) substantiate bullish sentiment. We get the signals of the uptrend continuation from bullish EMA & bullish crossovers.
Overall, bulls in the bullion market managed to ensure the consolidation phase, and it is likely to prolong as long as the current price remains above EMAs.
Trading tips: At spot reference: $1,305.84 levels, on trading grounds, one can trade this commodity via one-touch call option using upper strikes at 1,307.82 levels. The strategy is likely to fetch exponential yields if the underlying commodity price keeps flying towards this strike on the expiration.
As we could foresee upside risks in the weeks to come, on hedging grounds, we advocate initiating longs in CME XAUUSD futures contracts of mid-month tenors with a view to arresting further the upside risks.
Currency Strength Index: FxWirePro's hourly EUR is at 1 (neutral), the hourly USD spot index is inching towards -3 levels (neutral) while articulating at 13:46 GMT .
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