Before stepping into Monday its better prepare yourself to face the music of volatility in the markets. Last Friday the outcome of BRExit vote on leaving the European union had made a huge shock wave across major financial markets including Stocks, commodities and currency markets. And Fridays price action had done a major structural damage on the time series charts.
Since February 2016, Gold is trading in sideways mode between 28,000 – 30,000 per kg on the broader scale. Interestingly China (Shanghai Gold Exchange) last week launched its own yuan denominated Gold contracts which will become the reference price for gold in the country. The benchmark price for a 1 kg contract was set at 256.92 yuan/gram on Tuesday at the launch of the benchmark contract.
Here are the 4 visible signs (Volatility Sentiment, Magazine Indicator, COT Percentile , Gold Oil Ratio) we look into it to predict the possible bottom in Crude.
Just thought of posting quick update on Gold Medium term trend. Price structure of the Gold Weekly Charts are moving in a sideways bearish trend since mid of 2013. Longer term bearish momentum got faded out completely. In financial markets such fading moment mostly happens near the end of the trend(bearish/bullish). And the weekly outside bar on the Gold charts due to Fridays fierce price moment indicates bullishness likely to resume in Gold.
Gold Global is an international price based contract, exclusive of import premium, customs duty, sales tax/VAT, and domestic market premium among others. ‘Gold Global’ makes the refiners, exporters, jewellers, includes larger bullion physical market participants, involved in import of gold bars and re-export of jewellery happy
After much waiting and anticipation, finance ministry has recently released a discussion paper, which is mainly proposed on the available gold monetization scheme. Moreover, finance minister has even promised to get acquainted with the available budget speech. Estimating the gold holding among so of the Indian households is now getting at none other than 20,000 tons, and the finance minister is likely to introduce a perfect gold monetization scheme.
Now copper is trading around $2.8626 & as we can see on charts , after spending more than 10 trading session , finally copper providing a downside breakout with aggressive volume. The reversal coming in copper is from 61.8% fibonacci retracement level as well as very close to the top line of long descending channel . Below $2.8398 mark we may witness more weakness in prices.
Now silver is trading around $16.36 mark & as we can see on charts, silver rally was strongly rejected by descending trend line & this will be the 4th time when we have a rejection here. This shows the strength of the trend line. As well as the price are trading well below 38.2% fibonacci retracement now with RSI below 50 mark now.
Now gold is trading around $1211 & as we can see on charts gold following a upward trade line & reaching to the major resistance zone from $1224-1245. While looking at the big time frame gold still looking bearish & this move seems like 3 corrective move after completing the 5 wave downside elliott wave pattern.
Now crude is trading around $48.94 & as we can see on charts, its approaching to the broken tradeline of last symmetrical triangle pattern. This recovery seems to be a corrective one due to less volume & weak candlestick structure. However small timeframe charts showing some positivity but day & weekly charts are still bearish.
Now gold showing recovery from previous bottom level & also broken from a shot term descending channel as shown in picture. However this breakout is not supported well in terms of volume & that force us to stay concern about this upside rally. The strength of this rally will be tested on $1205 once.
Recently, Indian govt announced a particular scheme in their budget notes which took a lot of attention, especially gold merchants and speculators. With gold prices tumbling since last couple of years, the new scheme-if it works, would not only increase the supply of precious metal at domestic level, in-turn cuts our international gold imports which further depresses the price at global scale.