Ichimoku Kinko Hyo CNH/JPY: The CNH/JPY pair is trading above the Kumo…
Gold: a trend change coming?
Information is not investment advice
We've been talking a lot about the long-term downtrend of gold that's been the case since July 2020. Frequently, the price goes above and below that channel but then inevitably gets back into it. Since the end of 2020, that channel's upside has been mostly coinciding with the 100-MA. Now, golf is up there testing 100-MA below $1,800. Will it break the trend then?
First, even if it does, the trend may still stay valid just like it's been before: 80% of the time, the price was within the channel, but 20% still saw it deviate from the trend. Therefore, what we see now is just a possible breakout - whether it'll be a true trend change, only time will show: fo that, the changing configuration of the Moving Averages will serve as an indicator; so far, they're all aligned in a downward formation.
Second, gold may go as high as 200-MA at $1,850 just as it did twice previously. That all will not be an impediment for it to get back down into the channel: whatever the bullish breakaway is, it won't change the trend unless it goes beyond the resistance of the 200-MA at $1,850.
Lastly, observe an interesting thing: there is a double top at $1,955, and there is a double bottom at $1,680. The gold price failed to cross either. That suggests a possibility that in the coming months, it'll trade between the two revolving around the core channel of $1,800-1,850. Let's watch it!
In the middle of September 2022, the Canadian dollar has fallen to a 2-year low against the USD.
The US dollar index has all chances of reaching the 2000s high of 120.00.
Many investors treated gold as a protection against inflation. However, last week, gold lost its major support and dropped despite rising inflation. Why did it act like this?