6/29/2021
Gold price tumbled this morning to around -1% drop on the day after the dollar and shows strength amid the delta variant COVID strain that originated in India has spread to parts of Europe. Pandemic concerns always spark interest in the dollar over the metal as most investors like support from the US government and the Fed.
Our outlook
Gold is still under constant pressure as the Fed continues to talk-up the dollar with less concern for inflation. With big money slowly decreasing their long position sizes and upping their shorts according to the COT report last week, the pair doesn't look very bullish right now. The US economy is very busy once again and GDP is now showing any signs of slowing, which gold needs to rise.
Trade Setups
XAUUSD
Gold on the 4H timeframe has broken out below its wedge and headed back down to lows in the $1,750s. New resistance is now at $1,772, and price's recent strong momentum to the downside will probably keep gold at bay. A break under the $1,750 mark would spell bearish news for the precious metal.
XAGUSD
Silver may have bottomed-out around $25.50s after leaving a couple long wicks on the 4H to show rejection from these lows. 14-Day RSI is reading very close to oversold (30) on this chart suggesting that silver could see a bounce, but it may enter a consolidation zone around this support zone if price doesn't break under.
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