Gold preview – week of June 22, 2015

Last week

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GOLD bounced from its low after the FOMC rate announcement Wednesday. The Fed kept interest rates unchanged, which gave a big boost to the price of Gold. At the same time, the Greek debt drama also contributed to the two-day rally.

Last week Nat correctly identified the FOMC meeting as the main driver for gold prices, and warned traders to watch the inflection points. She wrote:

…traders need to focus on the resistance and support levels. They also need to be aware of the trigger points for potential movement. The first resistance level is lying at 1196.50-1192.50 zone and first support level is lying at 1150-55 zone this week. The 1198.50 line will be the trigger point for stop runs to the upside and 1160.50 will be the trigger point for stop runs to the downside…

As the week progressed attention shifted to the mean line/pivot point identified in her members’ trading plan, which became support for the price and the break-out point for the move up. The stop run and volatility she expected showed up and moved the price to her second resistance level around $1203.

One developing pattern worth watching is the tendency of major price moves to occur while the North American market is closed. Last week again a major part of the move happened during the European trading. There was a good bump on Wednesday (June 17) after the 2:00 pm FOMC announcement declining an immediate rate increase, but fully two-thirds of the move occurred while the new York market was closed.

By the time the US market opened Thursday the move was over. However traders who entered at Nat’s mean line/pivot point and held the position until Thursday captured about $23, or $2,300 per contract.

Here is the annotated intraday chart:

Gold futures, June 19, 30-minute bars

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Member content

Download the full trading plan, with the buy/sell numbers here: 150620-gold

This week

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Gold futures – weekly chart

The talking between Greece and its creditors will continue to influence GOLD price moves this week. There is another “emergency meeting” of the Eurogrouup Finance minsters scheduled for Monday. If there is any further hint that Greece will default on the payment due June 30, it could set off a chain reaction for Europe and possibly the global economy.

The 1205-08 zone will be the first area to watch. A move above it will be slightly bullish for GOLD, and the price could be pushed up to 1223-21 or higher up to 1235-38, the major short-term resistance zone.

The Daily chart has a small overbought condition, but the intermediate-term still has some room for an upside move. We may see Gold pull back to last week’s low area 1172-68 early in the week. Nevertheless buying on the dips will be seen and new buyers will help to hold the price up.

Therefore our traders should pay attention on the buying side this week if there is a pullback into support levels at 1180-85 and 1175-72

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