Spot Gold Technical Analysis

In early Asian session on Thursday (August 4), spot gold is currently out of a pattern of first falling and then rising, and the price of gold is now reported at US$1,767.8 per ounce. Looking back on yesterday’s market, the trend of gold was volatile on Wednesday, and the market during the Asian session was volatile last week. During the European session, the first-line pressure of 1770 retraced to 1760 and stabilized. During the US session, the daily high was 1772.6, and then it fell rapidly to refresh the daily low to 1754, and finally closed at 1765.3 US dollars per ounce, and a positive K was received on the daily line.

On the news, due to geopolitical tensions, the price of gold soared to $1,787.8 an ounce on Tuesday. At present, the geopolitical situation is still tense, and risk aversion is supporting gold.
At the same time, Fed officials sent some messages to the market, one side, dispelling market expectations for the Fed to cut interest rates next year. On the other hand, hinted at a chance of just a 50bps rate hike in September, but also a 75bps rate hike if inflation doesn’t improve. Therefore, the next US economic data released will be the key, providing guidance for the Fed’s interest rate hike policy.

According to the report of the world’s largest gold ETF, after the recent increase of 0.58 tons of gold on July 29, U.S. time, it subsequently reduced its holdings of gold by a total of 5.22 tons on August 2 and 3. The data shows that institutions are still not optimistic about the prospect of gold in the short term.

On the technical side, spot gold is on the daily chart and affected by the geopolitical situation, the market has risen in the short-term. Pay attention to yesterday’s highs of 1772 and the first-line resistance of 1780.

The price of gold is approaching the upper track position of the Bollinger Band, and the KD indicator is dead cross at downward, and there is a chance for a correction. In the 4-hour cycle, the market fell sharply to 1755/1754 and stabilized yesterday.

You can continue to pay attention to the support of this position during the day. In addition, the price of gold is running above the middle track of the Bollinger Band, and the KD indicator golden cross still has the momentum of last week.

In 1 hour, the bulls were densely arranged, and the upward momentum was strong, but it was close to the upper resistance, and the KD indicator was also running at a high level. As the US non-farm data will be released tomorrow, the market tends to be cautious, and the geopolitical situation is still fermenting, so it is recommended to do more on dips in intraday operations.

Resistance positions: 1772/1780/1786

Supporting position: 1755/1751/1745

Investment Advice:

#1: Aggressive can sell near 1775, defend 1781, target 1765/1760/1755.

#2: More around 1755-1757, defend 1750, target 1765/1772/1780.

Analyst: Mr.Chris Lau, Independent Analyst

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