Tariffs and trade war are the key factors afoot in world markets following last week's central bank-driven volatility. Emerging markets find themselves in the crosshairs with economies linked to Chinese exports hardest hit.
Article / 03 October 2016 at 12:10 GMT

Gold is coiling for something... but we need to be patient

Technical Analyst / FuturesTechs
United Kingdom
  • Gold topped out at 1377.5 in July, just shy of a big Fibonacci level
  • It's been sideways/messy since
  • We are holding support at 1310 though
  • A move is due, but there's no point trying to pre-empt it!

By Clive Lambert

Gold got up to $1377.5/oz in July, which was bang on a big area of resistance. $1380.7 is the 38.2% retrace of the entire move lower since we topped out at $1923.7 back in September 2011. This sell off saw us down to $1045.4 towards the end of 2015.

On the way down we saw a significant high/failure at $1392.6 in March 2014 as you can see from our weekly chart.

So $1380-$1400 was always going to be a tough area to see off, and so it's proved.

What we've seen since that July high is a pretty tight range with support showing up at $1310 in late July, an area that's held on a number of tests since.

All the time we're above $1310 I'm prepared to give the bulls the benefit of the doubt and expect this to resolve to the upside, which might "trigger" on a move above the short term downtrend line on our daily chart, which currently sits at $1346.

But for now we're not making this move and Friday was another example of selling on strength.

This hold of support whilst making lower highs in the short term has formed something called a descending triangle in chart terms. These are generally "completed" or resolved in the direction of the overall trend, which is higher. So we should, according to conventional chart wisdom, break $1346 then head back to, then through $1380-$1400.

But for now it's a waiting game...

Chart 1: Weekly Bar ChartGold Weekly
Source: CQG 

Chart 2: Daily Candlestick chart showing the descending triangle continuation/holding pattern.
Gold Daily
 Source: CQG

— Edited by Clemens Bomsdorf

Clive Lambert is chief technical analyst at FuturesTechs 

Clive Lambert - FuturesTechs Clive Lambert - FuturesTechs
Well, we certainly got a move today! 1310 broke and broke hard. We have been as low as 1270 as I write, and look set to head to Fibonacci support at 1252 now.


The Saxo Bank Group entities each provide execution-only service and access to permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on or as a result of the use of the Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. When trading through your contracting Saxo Bank Group entity will be the counterparty to any trading entered into by you. does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of ourtrading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws. Please read our disclaimers:
- Notification on Non-Independent Invetment Research
- Full disclaimer
- 沪ICP备13028953号-1

Check your inbox for a mail from us to fully activate your profile. No mail? Have us re-send your verification mail