Better US Non-Farm Payroll suggested a very optimistic outlook on the US economy as a whole. No doubt that market has taken this as another positive confirmation that the Federal Reserve could look to hike rate in June. Such action confirms a strong US dollar index and the equity market cheered with a strong rally, thus investors look to the US as the steam engine.
Meanwhile, the Eurozone saga continues with Greece under fire to generate solutions on their debt restructuring. Call it what you want (domino effect), such action could create a ripple throughout the EU should Greece decide to leave the Eurozone. Extract from ForexLive.com also indicate a rather one sided short trade in the Euro and USD position – indicating a possible correction.
One familiar and seems repetitive tone as we start 2015 is where central banks and bankers are busy making up new policies and names. All in the name of achieving unrealistic economic growth expectation – such atrocious move is not questioned bur rather welcome in fact. Such lunacy has got a time limit and one should not be surprise if we see a change in sentiment should the dust settle.
Central banks continue to take arms by lowering interest rate – in the face of deflationary threat. What they do not see is that it is inevitable the global economy cycle moves in crest and trough.
Gold Technical Outlook
Weekly Chart
The yellow metal is holding on to support at 20 WMA $ 1216 areas and managed to rebound. This rebound remains weak and only managed a mere push to $ 1235. We are slightly concern about holding long if next week rebound could not materialise higher. Respecting this trend line may be the way forward, thus we raise our stop loss to breakeven level if prices break below $ 1216 and $ 1209. We cannot discount the fact that prices may retest the trend line and then start a rebound higher. However, this will be invalid if prices break and close below $ 1197 as that could lead to much lower prices.
|
Trade: Should the opportunity arise then place a buy at $ 1197 to $ 1207 level with a stop loss at $ 1191 to target $ 1216, $ 1224 and $ 1235 area. Valid for this week only. |
|
Contract |
Valid Date |
Price |
Action |
Stop Loss |
Target |
Results |
|
XAU |
09th -13th Feb |
1226 |
Live |
1221 |
1236 |
|
|
XAU |
09th -13th Feb |
1221 |
Live |
1221 |
1248 |
|
|
XAU |
09th – 13th Feb |
1216 |
Live |
1221 |
1263 |
|
|
XAU |
16th – 20th Feb |
1207 |
Order Placed |
1191 |
1216 |
|
|
XAU |
16th – 20th Feb |
1201 |
Order Placed |
1191 |
1224 |
|
|
XAU |
16th – 20th Feb |
1197 |
Order Placed |
1191 |
1235 |
|
20 WMA |
50 WMA |
100 WMA |
|
1216 (+1) |
1263 (-2) |
1299(-4) |
Silver Technical Outlook
Weekly Chart
Playing on our previous commentary, we managed to lock in as much pips as possible. Our cautious trading plan by moving the last contract stop loss was a favourable one as Silver managed to find support at $ 16.55 which is the 50% Fibonacci retracement line and then rebounded higher.
Daily chart has shown a minor support and possible reversal of the downside trend (see chart below). The upside is currently capped by 200 DMA at $ 17.43 and we felt that the start of next week could see silver prices testing lower before a possible retest to break above it. Break and close above $ 17.66 will allow the bulls to test $ 17.77 and previous high at $ 18.50.
However, we remain biased for more downside as the weekly Bollinger band is starting to converge again. Our real concern remains at the long term downtrend line which could act as support and the lower Bollinger band may creep higher – possibly at $ 15.55 area. We see lower prices but well aware of the positive divergence in the weekly RSI.
|
Trade: The move higher could be a fake bullish move and we could take a small contract to short in the open with a stop loss at $ 17.66 and target $ 17.26 and $ 17.06 which are all important DMA that could act as support. Valid only for this week and could look to move stop loss to break even once we are in the money. We will stay on the side line if prices hit our stop loss and revise our view. |
|
Contract |
Valid Date |
Price |
Action |
Stop Loss |
Target |
Results |
|
XAG |
02nd – 6th Feb |
17.60 |
Closed |
17.25 |
16.45 |
+35 |
|
XAG |
16th – 20th Feb |
Open |
Order Placed |
17.66 |
17.26 |
|
|
XAG |
16th – 20th Feb |
Open |
Order Placed |
17.66 |
17.06 |
|
20 WMA |
50 WMA |
100 WMA |
|
16.76 (+6) |
17.76 (-5) |
18.97 (-6) |
Platinum Technical Outlook
Weekly Chart
We are adding both Platinum and Palladium into our weekly studies with similar layout. The purpose of this addition is to give our target readers a full picture on the precious metal group that Sharpspixley.com covers.
Platinum continue to consolidate after registering a rather remarkable run to the upside, followed by a pent up demand from gold. January 2015 saw higher Platinum prices registered at 1287 which was the high back in October 2014. Prices have then retraced lower, with potentially more downside after the failed upside and a shooting start doji followed by a full bearish candlestick. Price action could continue in this range trading so we felt a buy at $ 1180 and $ 1172 is viable with a stop loss at $ 1162 to target $ 1225 and $ 1265.
|
Trade: Side line for now as we cannot rule out a possible retest of previous low at $ 1172 while Bollinger band is converging for a breakout. RSI continue to post a positive divergence and should it find support then we could see higher prices. |
|
Contract |
Valid Date |
Price |
Action |
Stop Loss |
Target |
Results |
|
Pt |
16th – 20th Feb |
1180 |
Order Placed |
1162 |
1225 |
|
|
Pt |
16th – 20th Feb |
1172 |
Order Placed |
1162 |
1265 |
|
20 WMA |
50 WMA |
100 WMA |
|
1225 (+/-) |
1351 (+/-) |
1393(+/-) |
Palladium Technical Outlook
Weekly Chart
A bearish bear flag continue in this range trading – giving Palladium a true range to move about. The 100WMA provided support $ 765.99 for now and rebounded well to test higher numbers as well as forming a rather bullish hammer candlestick. If this range continues, a bounced off $ 765 area will give a reason for trader to aim $ 808 and $ 823 level which is the upper range.
|
Trade: Trade valid only for this week should prices pullback then buy in between $ 765 to $ 776 to aim $ 808 and $ 823 level. A break and close below $ 730 then we will consider shorting the metal which could retrace below $ 600 level. |
|
Contract |
Valid Date |
Price |
Action |
Stop Loss |
Target |
Results |
|
Pd |
16th – 20th Feb |
$ 765 |
Order Placed |
759 |
808 |
|
20 WMA |
50 WMA |
100 WMA |
|
783 (+/-) |
810 (+/-) |
766(+/-) |
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