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Technical analysis of Gold – Levels checkup

At the beginning of the week we wrote an article about technical analysis of gold. This article provides checkup of these levels and reaction of the price on them.

At the beginning of the week we wrote an article about technical analysis of gold. In this article we analyzed gold futures on volume indicators, which were lightly introduced. As a result of this analysis has been setup of levels, possible supports and resistances for this week. This article provides checkup of these levels and reaction of the price on them.

Read more: Technical analysis of Gold

Volume profile

This week did not bring any significant move and yellow metal has been slightly swinging to the side in tight area 1916.1$ – 1952.1$, shown at purple rectangle in following chart. We can see that this week’s move is continuation of the side move from last two weeks.

30 minutes chart of GC (Gold futures), Source: tradingview.com

Volume profile pointed out support and resistance levels based on POC, point of control, which means highest traded volume of selected session. Support was at 1917.5$ and resistance at 1946.5$.

Chart below shows punctual reaction (blue ellipses) on mentioned levels. Right from the beginning of the week price closely touched the yellow line, and right after is immediate reaction up, in number +1.22% to the high of day at 1941.5$.

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Second reaction is at resistance level, second blue ellipse, where price elevated to the level and right after reversed back down. More from tested level to the low of the day represents -1.26%. Third reaction was on Wednesday, where price fully tested same support at 1917.5 and the move up has been holding until today with actual (time 17:44 CET) high of the day at 1952.1, in numbers +1.80%.

30 minutes chart of GC, Daily Market profile. Source: Author´s analysis

VWAP

Another volume indicator included in the analysis was VWAP, monthly and weekly range. Because of the tight, side range of the price move, monthly levels were unharmed, therefore we check only weekly VWAP. Side move is good visible here, bordered by red dotted line (1st standard deviation) and reaction on levels are shown by blue ellipses.  Support at 1918.8$ has worked several times and resistance at 1943.2$ once.

30 minutes chart of GC, Weekly VWAP. Source: Author´s analysis

Bigger move

As we can see, tight range of the gold prices this week has tested only closer levels from analysis. Therefore, there are not mentioned another indicators from previous article. Yellow metal is still waiting for a bigger move, which could be sparked by any fundament. For example, French presidential election this weekend, where far-right nationalist Marine Le Pen gets higher numbers in poll as awaited. Le Pen as potential winner, could bring uncertainty in EU decisions policy, in addition as Bloomberg wrote. Armed with a veto on most EU initiatives, she could bring the bloc to an abrupt halt.

Tomas is a professional trader and money manager on foreign exchange market from 2014. His main domain are commodities. Experiences gained due this period are transformed to consul...

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