The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.
Today we also look at potential short positions on a daily close below $1307.15 – the 50% retracement of the June to August rally.
As you can see from the chart below, over the last couple of days spot gold has found good buying activity at this retracement and therefore with the daily MACD firmly below zero and heading lower, we feel selling spot gold on a close below $1307.15 could work well from a momentum strategy. If this were to materialise we would continue to suggest a potential stop loss at $1378.
In upcoming trade we get the August read on US durable goods (expected to decline 0.2%) and new home sales (anticipated to increase to 420,000 homes). Good numbers here could inspire gold selling.
So to recap, our potential strategy is to look to sell on rallies to $1335 or sell on a daily close below $1307.15. In either case we feel placing a stop at $1378 is prudent, while we initially look for a downside move to $1278, although could look at extending this if momentum gathers pace.
See gold chart below.
Follow this market on our trading platform
Our Trader Radar watchlist is updated each week with the above market. To find the watchlist:
- Log in to the trading platform.
- In the Watchlist panel, select Trader Radar from the drop-down menu. If this panel is not visible, click the Watchlist button (at the top).
- Alternatively, select Trader Radar from the Watchlist section (near the bottom left hand corner) in the Finder panel.