XAU/USD: Gold is ready for a bullish trend towards 1865.77
(Jing Ren – Orbex)
The current Gold chart shows a large correction pattern, which takes the form of a cycle triple zigzag.
The last section of the chart shows the structure of the bearish cycle intervening wave x, which looks completed in the form of a primary triple zigzag Ⓦ-Ⓧ-Ⓨ-Ⓧ-Ⓩ.
Perhaps in the next coming trading days, the market will turn around and start moving up, in the initial part of the cycle wave z. It may take the form of a primary standard zigzag Ⓐ-Ⓑ-Ⓒ, as shown in the chart.
The price of gold in the wave z may rise to the price mark of 1865.77. At that level, it will be at 61.8% of previous actionary wave y.
Let’s consider the second scenario, where the downward movement of the pair continues in the cycle wave x. The final primary wave is under development.
Thus, a downward movement of XAUUSD is expected in the near future. The primary wave Ⓩ may take the form of an intermediate zigzag (A)-(B)-(C).
The final of the correction pattern zigzag (A)-(B)-(C) is possible near 1566.12. At that level, primary wave Ⓩ will be at 76.4% of primary wave Ⓨ.
Only after reaching the specified level, the development of the cycle wave z will begin.
Murrey math lines: USD/JPY, USD/CAD
USD/JPY, “US Dollar vs Japanese Yen”
As we can see in the H4 chart, USDJPY is moving within the “overbought area”. The Relative Strength Index has rebounded from the descending trendline. In this case, the pair is expected to test 8/8 (143.75), break it, and then correct downwards to reach the support at 7/8 (142.18). However, this scenario may be cancelled if the price breaks the resistance +1/8 (145.31) to the upside. After that, the instrument may grow to reach +2/8 (146.87).
In the M15 chart, the pair may break the downside line of the VoltyChannel indicator and, as a result, continue its decline.
USD/CAD, “US Dollar vs Canadian Dollar”
As we can see in the H4 chart, USDCAD is also trading inside the “overbought area”. The Relative Strength Index is above 70, confirming a possible decline. In this case, the price is expected to rebound from +1/8 (1.3793) and resume moving downwards to reach the support at 7/8 (1.3549). However, this scenario may no longer be valid if the price breaks the resistance at +1/8 (1.3793) to the upside. After that, the instrument may continue growing towards +2/8 (1.3916).
In the M15 chart, the pair may break the downside line of the VoltyChannel indicator and, as a result, continue trading downwards.
Daily technical and trading outlook – USD/CHF
Trend daily chart
21 HR EMA
55 HR EMA
Trend hourly chart
13 HR RSI
14 HR DMI
Consolidation with upside bias.
1.0064 – May’s 3-year high.
1.0000 – Psychological handle.
0.9966 – Mon’s 3-month high.
0.9886 – Hourly chart.
0.9855 – Mon’s NY low.
0.9805 – Mon’s European low.
USD/CHF – 0.9941.. Despite retreating fm 0.9947 in Australia to 0.9850 ahead of NY open Tue initially, dlr found buying there n rebounded strongly to 0.9923 near NY close on renewed usd’s strength due to rise in U.S. yields.
On the bigger picture, dlr’s impressive rise fm Jan’s near 6-year bottom at 0.8758 to 0.9472 on the 1st day of Apr due to rally in U.S. yields suggests erratic fall fm 1.0344 (2016 peak) to retrace LT rise fm 2015 record 0.7360 low has ended n despite subsequent 1-year long monthly sideways swings, dlr’s rally abv 0.9472 in Apr to a near 3-year peak of 1.0064 (May) indicates price would head twd 1.0128. Despite subsequent fall to 0.9372 in early Aug, dlr’s rally back to 0.9869 in early Sep suggests correction over n would head twd 1.0064. Having said that, despite usd’s weakness to 0.9480 in Sep, subsequent rebound n Thur’s rally to 0.9851 would re-test 0.9869 while below 0.9699 risks 0.9621.
Today, dlr’s rally on Mon abv Jul’s 0.9886 high to 0.9966 signals the correction fm 2022 near 3-year peak at 1.0064 (May) has ended n as price has risen after y’day’s strg retreat to 0.9850, re-test of 0.9966 is seen for gain twd 1.0000 handle later. Only below 0.9850 risks strg retracement to 0.9825/35.