July 6, 2021

Gold Leaps Higher Despite Dollar Strength

Frank Cabibi

7/6/2021

After coming out of the worst month in roughly 5 years, gold's price jumped as much as 1.4% on the day amid a higher US dollar index before retracing to the low $1790s. Retail sentiment is mixed overall as COT shows a decrease in long positions and an increase in short positions from institutional investors. This month is already showing positive traction despite the overall strength seen in dollar speculation of raising interest rates.

Our outlook

Big money started upping their short positions again for the past month and some days all the while gold's price has tumbled from the highs of $1917. Longer term, this metal looks less attractive when compared to the USD, and until sentiment changes back to a weaker dollar, this pair might continue to fall. However, there look to be some bullish plays in the short term.

Trade Setups

XAUUSD

Here is a look at gold from the 1H timeframe. After testing some heavy resistance, it retraced down to the low $1790s and caught support around $1792-3 range. The last 1H candle left a long wick suggesting another move up, and the trend since July started looks like a clean staircase to the upside.

A problem I'm seeing, however, is on the 1D chart where we have seen gold test resistance and retrace hard. The shorter timeframes do look more bullish, but the overall trend might not be able to continue upward. In fact, if this daily candle ends with big rejection like how we see it now, gold might be in for another leg down.

A1 Edgefinder

Watchlist
Save time looking for setups with the EdgeFinder's watchlist! In a glance, see the EdgeFinder's current top buys and top sells.

Discount code: 'READER'

Access Now

Free

Trading Plan Template
Struggling to build a successful trading plan? Download our template to get started today!
Download
Can The Dollar Break This Pivotal Level?

The dollar flew higher last week as a result of resilient economic news along with a higher PCE than expected. Now the DXY has reached a decision point in price action. This week's NFP will help determine the sentiment around the potential June rate hike. Here is what we are looking at: EdgeFinder Analysis USDCAD […]

Read More
Dovish Banks Could Crash These Currencies

Considerably dovish news from central banks in the US and New Zealand has caused a major stir in the markets. Governor Orr and Vice Chairman Powell both released some reassuring news for the economy in the long term. But what does this mean for USD and NZD? EdgeFinder Analysis GBPNZD is a pair that should […]

Read More
Kiwi In Need of Another Rate Hike

As we trade into a broad news week covering the economic status of multiple countries, there are several scenarios we should consider. Although it is impossible to predict the future, we can at least prepare for the news events set to come this week for kiwi, dollar and the pound. EdgeFinder Analysis GBPJPY still maintains […]

Read More
DISCLAIMER: All comments made by TraderNick’s Forex Group, LLC are for educational and informational purposes only. All comments should not be construed as investment advice regarding the purchase or sale of any securities or financial instrument of any kind. Please consult with your financial adviser before making an investment decision regarding any securities or financial instruments mentioned by TraderNick’s Forex Group, LLC. TraderNick’s Forex Group, LLC assumes no responsibility for your trading and investment results. All information on any of the platforms utilized by TraderNick’s Forex Group, LLC was obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. TraderNick’s Forex Group, LLC, its employees, representatives, and affiliated individuals may have a position or effect transactions in the securities and financial instruments herein and or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies. Trading of any type involves very high risk and may not be suitable for all investors. TraderNick’s Forex Group, LLC, its subsidiaries and all affiliated individuals assume no responsibility for your trading and investment result. Read our full disclaimer here
Home
Edgefinder
VIP
Menu
homesmartphonelaptop-phonemenu linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram