Gold Technical Analysis and OutlookGold Technical Analysis and Outlook: Fluctuating Upwards Ahead of the Interest Rate Decision, Beware of a Rally and a Rebound
Fundamental Analysis
This week's Federal Reserve interest rate decision will be announced. The outcome will have a decisive impact on the future of gold:
A 25 basis point rate cut is expected to trigger a direct decline in gold prices.
A 50 basis point cut, exceeding expectations, could push gold prices back down after a surge.
Market sentiment is cautious ahead of the decision, and volatility may narrow.
Technical Analysis
Yesterday's Market Review
Gold's early-week trend was fully in line with expectations, with a continuation of high-level fluctuations.
It dipped to 3626 in the morning (4 dollars below the 3630 support level) before quickly recovering. The inverted hammer pattern on the hourly chart clearly signals a rebound.
It continued to consolidate during the European trading session. Maintaining the volatile trend at the end of last week.
After breaking through the 3656-57 resistance level, the US market accelerated upward, reaching a new high of 3685.
Key Technical Signals
Breakout Confirmation Signal: A large bullish candlestick on the hourly chart breaks through the trendline resistance level, followed by a pullback to confirm support.
Accurate Pullback: The 5-minute chart shows a breakout above 3656 followed by a pullback to 3654-55 (the bottom of the last large bullish candlestick), creating a standard second entry opportunity.
Strong Early Morning Close: The US market closed at a high level after a strong performance, indicating continued upward momentum the following morning.
Key Level Update
Support Level: 3630 (the recent rebound of 6 1.8% golden ratio level)
Resistance levels: 3700, 3750 (extreme target)
Subsequent strategic layout
Short-term trading strategy
Long positions: Morning long positions at 3682-83 can be held, with the target at 3700.
Increase position strategy: Consider increasing positions in batches if the price falls back to the 3655-60 range.
Risk management tips: Execute stop-loss orders decisively if the price breaks below the 3630 support level, turning short-term bearish.
Medium-term strategy
Pre-interest rate decision: Maintain the 3700-3750 target range and gradually reduce long positions.
Post-decision strategy:
25 basis point rate cut: Direct Short Position
50 basis point rate cut: Short position after a surge
Target: 3600-3580 area is the primary target during the pullback phase.
Trading Alert
Market liquidity may decrease and volatility may increase before Thursday's interest rate decision.
Avoid chasing highs, especially long positions above 3700.
Manage your positions carefully and reserve funds to mitigate market volatility after the decision.
Pay close attention to the forward-looking guidance and dot plot changes in the decision statement.
Risk Warning: The above analysis is based on current market conditions. Investors are advised to strictly manage risk and allocate positions appropriately based on their risk tolerance.
