XAU Projects Bounce into May 11/14. Watch 84.57/XAU.
XAU Projects Bounce into May 11/14. Watch 84.57/XAU.
05/05/18 Weekly Re-Lay:
“Gold & Silver remain stranded in multi-month periods of congestion with Gold still trading in the upper 20% of its 4+-year trading range. That remains a bullish factor for the longer-term trend.
On an intra-year basis, however, Gold has dropped back down to the bottom 20% of its 4-month trading range. That is not very positive for the intermediate trend…
The XAU remains in a trading range that has contained it since Feb. ’17 – with support near 76.00 and resistance around 92.50/XAU.
The weekly trend is up with multiple neutral signals against it. The XAU would not re-enter that weekly uptrend until a weekly close above 87.10/XAU and, conversely, would not turn it down until a weekly close below 76.39/XAU.
In between those opposing extremes is a lot of consolidation and some uncertainty regarding the bigger picture.
That weekly trend pattern argues for an eventual rally back to the late-Jan. high (92.94/XAU) while the intra-year downtrend continues to provide a ceiling over prices. That could again be the case in the coming week.
The XAU has dual weekly LHR levels (weekly extreme upside targets) at 84.67 – 84.75, just above the intra-year downtrend resistance at 84.57/XAU.
Another factor that is poised to re-assert some influence is the weekly 21 MAC & 21 MARC. The weekly 21 MAC has been heading higher although the upper end of that channel is at ~85.24/XAU.
Beginning on May 14, however, the weekly 21 MARC will begin to surge – potentially exerting a negative influence on the weekly 21 MAC and on price – as early as May 14 or May 21.
Though these channels are less effective in a sideways trading market, ultimately they trigger a positive or negative signal when the market is ready to enter a new trend. If the XAU took 1 – 2 weeks to make it back to its weekly 21 High MAC, it would be testing that resistance at the same time the channel is about to flatten and turn down (barring an accelerated breakout above that level).
On a near-term basis, the XAU dropped into the end of April and set its lowest close on April 30, fulfilling a 19 – 20 day low (Feb. 9) – low (Mar. 1) – low (Mar. 20) – low (Apr. 9) – low (April 27/30) Cycle Progression.
It has rebounded and twice neutralized its daily downtrend. The XAU needs a daily close above 83.32 to turn that trend – AND the new intra-month trend – up.
That signal is what it would take to elevate this rebound and project a rally back to at least 84.67. That would also remove the lingering possibility of any additional spike low – or retest of the May 1 intraday low – in the coming days.
The April 30/May 1 low fulfilled the weekly HLS indicator – projecting an intermediate low in the week(s) that followed April 27. That also perpetuated a larger-degree ~5-month high (early-Sept. ’16) – high (early-Feb. ’17) – low (early-July ’17) – low (early-Dec. ’17) – low (early-May ’18) Cycle Progression…
The XAU has been adhering to a 14 – 16 trading day cycle spanning several recent highs. At the same time, a more precise 17 trading-day low (Mar. 1) – high (Mar. 26) – high (Apr. 19) Cycle Progression has formed and projects an ensuing high for May 14 – a couple days after the other cycle recurs.
It should not be overlooked how many of these cycles – stemming from price action weeks, months & even years prior – focus on the days surrounding May 12 – 14, a double-whammy of anticipated Middle East events (May 12 Iran Nuclear Deal deadline and May 14 US Embassy-to-Jerusalem relocation).
Precious metals and equities often reflect these types of uncertain situations more than anything else, so these cycles should come as no surprise.”
Gold, Silver & XAU poised for bounce into May 11/14 before subsequent drop on May 14 – 18 – when Gold cycles converge. The XAU should bounce to 84.57 before a short-term peak is seen. See Weekly Re-Lay & INSIIDE Track for additional analysis and/or trading strategies.