Thoughts on Gold
Gold prices reached over $1,900 today as futures shot up in earlier this morning. This metal seems to gain more and more momentum as news between US and China becomes worse. Uncertain markets and uncertain currencies give gold more of an appeal to it. Although gold has been overbought on the 14-Day RSI for several days, it seems like there is no end to its demand.
An issue that always comes back into mind is that confusing times do not always bring out panic selling but panic buying as well. Investors don’t want to miss out on the price swings so they continue to buy up positions before prices break previous highs at $1,918. That price is what we’re looking at as potential resistance for the metal. We definitely think there is some downside potential ahead, but we don’t think it will last long. A long position now would seem like a price chase but it could work out as we think gold has a little more room to run. Citi Group, on the other hand, feels that XAU can go all the way to $2,000 before major demand for the metal dies down. RSI currently at 82 which indicates that price is really high. A price of $1,918 in the next few days could set the RSI closer to 90 which means that investors might dump what they have before a pullback. Overall, we are bullish on gold but temporarily waiting for some give in prices so we don’t go price chasing.
Futures still look promising although current price is well above July contracts. Pushing highs does not seem out of reach, but will wait to see what futures look like after once that level is hit. If they’re trading higher than before, then a break in long term resistance will be a very bullish sign for investors.
All US indices fell yesterday as big tech dropped after earnings. The surge of buying pressure from the passed months finally stopped when investors dumped shares to take profit.
Trade Ideas on NAS100
Prices initially fell after the index tested highs again and formed more resistance at $10,788. The last 4H candle actually came down to the 200H moving average before bouncing back up today. Some mild resistance in the way at $10,527, but stronger resistance lies above at $10,788.
Intel plummeted to April lows at $49.52 after earnings and news of their delay in chip production. RSI reading that price is oversold and could be something to consider looking in to.
Tesla falls over 4% today after the big sell off. Recent news states that Tesla is suing the company Rivian for possibly stealing some of Tesla’s intellectual property. TSLA‘s run looks like it’s taking a break for now.
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Please note that this email is my personal opinion only. I am not a licensed financial advisor, and any information shared or discussed is not to be construed as investment advice. Trading and investing involves a degree of risk, and is not suitable to all investors. Please consult with your financial advisor before making any sort of investment decisions.