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Gold Monitoring Thread £ only

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On 26/01/2019 at 10:12, shortstack68 said:

I think a double top to $1309 before dropping again, possibly forming a cup and handle which i think is a bullish formation

The top of the cup is around the $1350 level - then a pull back if we are to see the cup and handle and then the push on up from there.

There is a good deal of chart resistance at the $1350 level, so a pull back seems likely. Then another run up and through the resistance so completely the cup and handle.

 

 

http://www.newtraderu.com/2012/08/20/why-the-cup-handle-chart-pattern-works/

d2gTO2Vz.png

Edited by sixgun

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55 minutes ago, sixgun said:

Price breached $1300, returned to $1300, so resistance became support.

 

doesn't work like that. we are currently at ~$1310 which is

within the ~$1300 support/resistance zone. it's still deciding

what it wants to do as nothing has happened yet.

 

HH

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3 minutes ago, HawkHybrid said:

doesn't work like that. we are currently at ~$1310 which is within the ~$1300 support/resistance zone. it's still deciding what it wants to do as nothing has happened yet.

HH

Price went through $1300 - it returned to $1300, the previous resistance level, found support and moved up. You don't believe it works like that but it just did.

 

Price is now moving into a support/resistance zone between where price is now just over $1312 and $1360. So agreed it will struggle from here on up, it might even get sent back down to $1300 and then lower, but what i described is exactly what happened.

d2gTO2Vz.png

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there is no such thing as a resistance level that is a single

figure such as $1300. $1300 is part of a larger resistance

zone. if you listen to traders who understand it, they

describe it as a cushion effect as opposed to a brick wall.

the zone that includes $1300 has not turned into support

yet as the outcome is still undecided. 

 

(you can't be right about it bouncing off the $1300 now turned

support level cos from your charts it bounced from ~$1298.

if it was a brick wall effect support level should it not bounce

from pretty much exactly $1300?)

price action is not a science. bounces can be made from

anywhere within a resistance zone. the wading through a

resistance zone means nothing until it can actually find

the strength to break through the whole of the zone and

leave it behind.

 

(when traders talk about a resistance/support level they

are using a number to represent a zone. a bit like how

acronyms are used)

 

HH

Edited by HawkHybrid

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Well i have discussed charts with 100's of professional and semi-professional traders and i don't remember them referring to cushion effects. So i guess none of them understand them. i put "cushion effect chart support resistance" into Google and nothing came back, so it seems it is a term you made up rather than something those who understand are using. i do know what you mean and it is a useful term.

i pointed out what price did - you said it didn't and so i posted the chart showing what it did and that i had simply described what it did. i know about support resistance zones. Funnily enough i am a member of the Society of Technical Analysts.

Edited by sixgun

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54 minutes ago, sixgun said:

Well i have discussed charts with 100's of professional and semi-professional traders and i don't remember them referring to cushion effects.

 

just cos your trader mates are bad at describing things, it's ok

you can borrow descriptions my trader mates have come up

with if you like :). the important thing is that traders will

understand it when a cushion effect is used to describe it as

opposed to a brick wall effect.

(this doesn't make them bad traders, some people just aren't

very good at describing every day things.)

my objection is that I believe the $1300 resistance zone

has not been breached and the results are as yet undecided.

 

HH

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@HawkHybrid your cushion term is helpful.

i agree it is a zone not an exact line. i agree price may not have sufficient momentum to escape the (magnetic) support/resistance level - it may get pulled back into the zone and then have another go or fall down through the zone. You might be surprised we agree about quite a few things. Nothing is decided until after the event. We'll have to see.

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The markets were waiting for the press release from the FOMC meeting. This was issued at 14:00 EST, which is 19:00 GMT. The Fed's comments were interpreted as 'dovish', meaning less chance of an interest rate increase, or of further monetary tighteninng. This was positive for gold, so traders moved into long positions.

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I watched Powells’ speech live,at the same time as having a live stream of the gold price..interesting to see what comments caused the 

price of gold to rise and fall..bottom line is...dovish fed = less likely the fed funds rate will rise ...will watch Gregory Mannarino on YouTube tonight to get a proper traders view on it ...

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This recent presentation from Jeff Christian is worth watching. Jeff runs CPM Group, which is a commodity research outfit. He is not a pumper, and indeed during 2011-2015 he was constantly criticised by pumpers because he was bearish on gold. Now he's bullish - cautiously in the short term, but more aggressively in the longer term.

https://www.youtube.com/watch?v=E5a8gTVdKDs

 

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13 hours ago, Britannia47 said:

What are you guys talking about? Am I living on a different planet!

Gold Monitoring Thread £ only but the discussions on this thread delve into macroeconomics and technical analysis both influence the gold price. Both subjects if you spend the time energy and effort you can gain a good understanding of them.

Take for example Silver Fortune undergraduate studying veterinary medicine but watch some of his video he has a good grasp of macroeconomics https://www.youtube.com/channel/UC_bZMqzqYA_1BHa0Sul5MBw

I see this thread as a discussion about the preservation of purchasing power in what I consider probably the most financially challenging times in history.

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It is interesting that this thread is called "Gold Monitoring Thread £ Only" and yet the chartists nearly always present their charts in $ (XAU/USD). The point is that charts of the gold price look completely different depending on the currency cross. I have read recently that gold is at or close to all time highs in approximately one third of all the currencies in the world. Looking for technical formations is bound to give completely different results for different currencies. To say, "gold is priced in dollars" is missing the point. Gold can be priced in any currency you choose just by dividing through by the dollar exchange rate. It is more appropriate to point out that gold is mostly traded in dollars, but even then, it is surely the currencies of the producers and consumers of the gold that matter most: what goes on in the supply chain in between should just come out in the wash.

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2 hours ago, Bumble said:

It is interesting that this thread is called "Gold Monitoring Thread £ Only" and yet the chartists nearly always present their charts in $ (XAU/USD). The point is that charts of the gold price look completely different depending on the currency cross. I have read recently that gold is at or close to all time highs in approximately one third of all the currencies in the world. Looking for technical formations is bound to give completely different results for different currencies. To say, "gold is priced in dollars" is missing the point. Gold can be priced in any currency you choose just by dividing through by the dollar exchange rate. It is more appropriate to point out that gold is mostly traded in dollars, but even then, it is surely the currencies of the producers and consumers of the gold that matter most: what goes on in the supply chain in between should just come out in the wash.

It is entirely the point because countries currency are not being determined by the gold price or vice versa, so charts based on anything other than $ are going to give false signals.  A currency with a positive story could rise 5-10% and the relative gold price fall even with headline $ gold price rising.  i.e. your trading on fundamentals, not technical analysis.

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But surely, no country's currency, including the USD, is determined by the gold price. The XAU is in effect just a currency itself, and there is no special significance to the XAUUSD currency cross as compared with XAUGBP or any other currency cross. One could, I suppose, use a basket of currencies to get a kind of average value for gold: I have seen charts of gold priced in SDRs. But then it is contentious as to what currencies should be in the basket and at what weightings.

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Yes but gold is priced in USD. Then the current exchange rate for instance in my case USD to GBP determine the value of MY gold. Thats why when the pound is weak against the dollar the value of MY gold has gone up - even if the ACTUAL price of gold priced in USD has stayed the same. The pricing in USD is just the standard that we work to so everyone is singing of the same hymn sheet.

Edited by AuricGoldfinger

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chartist price gold in usd(currently) cos they want to know how

the global price trend of gold is moving. pricing it in any other

currency just introduces more variables.

eg if £ drops by 10% versus $ and many other currencies. (for

arguments sake) £ has 10% inflation so £1.10 is required to

buy what was previously priced at £1.00. let's say gold goes up

by 5%(usd) due to uncertainty. gold in £'s has gone up by 15%

but only cos £ has weakened. the amount of gold required to

buy a tailored suit my now be 0.95 toz as opposed to 0.85toz.

ie gold as a store of value has increased by 5% and not 15%.

 

currently pricing gold in usd gives the clearest picture of any of

the currencies available. it's more a practical thing to price gold

in usd.

 

HH

Edited by HawkHybrid

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But as I see it, we don't get to choose the number of variables. The price of gold depends on lots of variables and that is how it is. Of course, if the value of GBP falls against USD then gold becomes more expensive in GBP, but the same reasoning holds for USD. If the American economy is strong and the USD rises against other currencies this makes gold go down against USD, but that is just an artifact of the strong dollar. It tells us nothing about changes in the global demand and supply of gold, which is what prices are supposed to do. I don't doubt that USD is the most important currency, but if we wish to derive information from the price of gold we need to abstract away from the relative movements of all the fiat currencies.

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