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By Anna Coulling (Reporter)
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Some Christmas cheer for gold bugs

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weekly gold chartIt’s been a dismal year for gold bugs, but one which perhaps is going to end on a more positive note based on the weekly chart, which has seen a classic accumulation phase develop for the precious metal. Note in particular the initial stopping volume of w/c 13 August, with further sustained buying through to 8th October.

Last week’s price action was seminal, with gold breaking through strong resistance in the $1238 per ounce region.  In addition, this price action was supported with excellent volume and in agreement, with the trend monitor confirming the transition to the bullish sentiment. A recovery to $1280 per ounce now seems possible and possibly to $1300 per ounce, provided this is supported with strong and rising volume on the weekly chart. And of course, further weakness in the USD may well provide additional help given the FED’s pace of rate increases which looks set to slow.

The key levels now ahead are at $1260 per ounce, not so much for the price resistance which is lightweight, but more signifcantly for the low volume node in this region on the volume point of control histogram. As a result, any move through here should be swift, before running into increasing volumes as we move back towards the volume point of control itself which awaits at $1310 per ounce. Not a level likely to be reached before Christmas, but nevertheless, a  happier end to the year than the start.

By Anna Coulling

Charts from NinjaTrader

Indicators from Quantum Trading



Source: https://www.annacoulling.com/forex-trading/some-christmas-cheer-for-gold-bugs/
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