Taking a broader view on XAUUSD

22 בדצמ׳ 2017

Around the beginning of the millenium, the pair XAUUSD adopted a long-term trend channel, which is depicted in this graph. In 04-2006, after having tested the upper barrier of that trend channel for the first time, prices assumed a short-lived horizontal drift almost in the channel's center at around 533$, before taking their first steps on the long march to the a-t-h amid the financial crisis in 2011. Bridging that epoch of extraordinary & trend-neglecting growth with a range of fib retracment levels, we obtain notable zones of support and resistance with proven significance. In the time of contraction after 2012, we can see that prices bottomed out in late November 2015, at the cross-over-point of two support zones, one being the upper barrier of the long-term trend channel, the other being the 0.38 fib level. Since then, prices rebounded sustainably. The 0.5 fib level around 1.200 was recaptured and maintained, while the 0.61 fib level at 1.340 proved a serious barrier till now. What to conclude from this model? Firstly, I see no immediate reason to take an overly bearish stance on gold. We are heading towards another cross-over point between the upper barrier of the long-term trend channel with the 0.5 fib level in Dec. 2019. I would not take any bet on prices below 1.200, after that point in time latest. Secondly, as an investor I would not assume XAUUSD stakes, so long as the 0.61 fib level at 1.340 is not put under serious test again. Continued upward pressure from the long-term trend channel and the fact that growth rates clearly run above the long-term trend, since prices rebounded in 2016, may bring about such a serius test of 0.61 fib even before 2019.

22 בדצמ׳ 2017

הערה

Please note that I had to use a timescale of weekly spot price averages to fit everything into the chart. That's the explanation of the gap between the 100-fib level and the graph.