GOLD bullish formations on key time-frames

2020年10月10日

Gold has closed last week in strong fashion as it registered the highest close since September 21, a few points shy of the MA50 on the 1D chart (blue trend-line on the left chart). This may be to many (and to be honest technically it is) a strong Resistance level, but in the last 12 months that level along with another formation, create a very bullish structure for Gold long-term.


** The 1D time-frame **
That is the MACD Bullish Cross on the 1D time-frame. As you can see on the chart, every time the MACD makes a Bullish Cross and Gold is trading below or on the 1D MA50, a very aggressive rally follows. In fact in the last 3 occurrences since November 2019, Gold rallied +17%, +11% and +21% respectively, following such a series of formations.


** The 4H time-frame **
At the same time, we shouldn't ignore the smaller time-frame of 4H (right chart). As with 1D, that two at first glance waves a bearish signal as the price is almost on the Lower High trend-line of the Channel Down (blue channel) that started after the August 17 High and just broke above the 4H MA200 (orange trend-line) which last time initiated a sharp drop.

However I can't overlook the fact that the 4H MA50 and MA200 are close to forming a Golden Cross (happens when the MA50 crosses above the MA200). Since December 2019 (I couldn't fit that on the screen), that technical set-up has also kick-started a very strong rally. It is interesting to mention that this set-up always comes a few days later than the 1D MACD Bullish Cross. Additionally, the 4H RSI is near the level (77.000) where the 4H Golden Cross is typically formed.


Are those patterns bullish enough for you to deliver another aggressive rally or not? Feel free to share your work and let me know in the comments section!


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