In the midst of ongoing trade war tensions gold, this week had captured the psychological mark 1500 USD and trading around the overhead resistance zone 1520-1525 levels. Gold rallied and broken the 2014 year high from bottoming at $1,045 in December of 2015
The latest Commitment of Traders (COT) report showed Commercials category of traders ( representing gold miners, jewelers, and other large producers/merchants ) are maintaining a record net short positions and contrary to that large speculators ramped up their long positions since June 2019 onwards
Gold on the daily timeframe made its vertical spike post-Chinese yuan devaluation. ADX levels are still on the upswing mode in both daily and weekly is still ramping up since May 2019.
In India, domestic prices soared to a record, dampening demand for the metal in the world’s second-biggest gold consumer after China. The surge in USDINR and Gold in the International markets are adding double whammy to the Gold Investors in India.
MCX Gold Futures tested high of 38400 post yuan devaluation. That’s a whooping move from 35000 per 10 gram to 38400 levels since the start of August 2019.
In short term Gold hits the overhead resistance levels 1525 levels and could be trading around psychological levels establishing a newer consolidation zone and whipsawing around the psychological levels for quite some time.
Momentum in Gold is still at the extreme levels with volatility shooting up. Sharp volatile swings are possible as emotions are running high.