Technical Analyst, Saxo Bank Group
Check in on my Daily Technical Update video’s here on SaxoTrader
Or Subscribe to my Youtube channel Cramer’s Corner
Twitter X: Cramers_Corner
Gold (XAUUSD) is edging towards its all-time high at around USD 2,431, having made new higher closes over the past few days.
Despite this, the strength indicator RSI is suggesting potential uptrend exhaustion by showing divergence, which occurs when RSI values decline while the gold price continues to rise. However, as long as gold does not close below 2,319, the uptrend remains intact and could potentially push prices higher.
Gold is currently testing the 0.618 retracement level of the massive volatility experienced on the 12th and 15th April, at 2,390. Should gold break above 2,432, there could be room for a rise up to 2,497, which is the 1.618 projection of that volatile corrective movement.
Conversely, a close below USD 2,319 could trigger heavy selling in gold, with short-term potential dropping to around 2,260-2,255, representing the 0.382 and 0.618 retracement levels respectively.
Silver (XAGUSD) is displaying a technical scenario quite similar to gold, although it is not trading near its all-time highs.
Silver was rejected at the 0.618 retracement level of the volatility from 12th-15th April (green Fibonacci levels).
A break above USD 29.03 could likely ignite a new rally towards USD 30.64-31.16. The key question remains whether silver can sustain closes at these higher levels.
The RSI is showing minor divergence, but if it closes above its falling trendline, new highs could be expected for silver. The USD 29.80-30.10 area is identified as strong resistance, as seen on the weekly chart. Maybe too strong to close above
On the other hand, the weekly RSI also suggests higher silver prices in the coming weeks and months, with positive sentiment and no divergence observed.
Key support is at around 27.59. A break below this level is likely to lead to a sell-off down to the 0.618 retracement at USD 26.41
2024: The wasted year
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.
Disclaimer
The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. 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 Saxo News & Research 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 Saxo News & Research 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 Saxo News & Research or as a result of the use of the Saxo News & Research. 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. Saxo News & Research 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 our trading 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 Investment Research (https://www.home.saxo/legal/niird/notification)
- Full disclaimer (https://www.home.saxo/en-gb/legal/disclaimer/saxo-disclaimer)