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Fundamentals

During the Asian session on Thursday (October 26), spot gold fluctuated in a narrow range and is currently trading around 1983. Gold prices were still volatile around geopolitics and were not expected to disappear anytime soon. Gold prices are bound to continue to increase in fluctuation in the short term. Yesterday's wash trading might upset many investors. During European and U.S. sessions, gold prices first quickly surged to 1987, but they also quickly fell back to the 1962.8 level as strong hands sold the pair after the release of better-than-expected U.S. data. We stressed yesterday that we need to make a good plan and try to buy low and sell high at key levels. We advised investors to short at 1983 yesterday, and it turned out we can earn $20 by doing so. The profit/loss ratio is up to 4. We still expect the market to be volatile next and also advise traders not to chase the market, but to wait patiently for a proper opportunity. We can take it easy to enjoy trading and life when the market is stable. Trading is just a part of life, so, be relaxed and you may find it easier to make profits.

Data: The US total number of new home sales in September was 759,000 annualized, compared with the expected 680,000 and 675,000 in the previous month. The US MBA Mortgage Application Activity Index last week was 165.2, compared with the previous value of 166.9. The MBA Mortgage Refinancing Activity Index was 354, compared with the previous value of 347.6. The MBA 30-year fixed mortgage rate was 7.9%, compared with the previous value of 7.7%.

Geographical: Israel agreed to temporarily postpone its ground attack on Gaza pending the deployment of a missile defense system by the United States.  

Data that investors need to watch today include US initial jobless claims, real personal consumption expenditures, durable goods orders in September, preliminary Q3 GDP, preliminary core PCE price index YoY, and existing home sales MoM and YoY.  

Technical Analysis

Trading at the daily timeframe, gold prices fluctuated repeatedly yesterday, rising as high as 1987, then retracing to the lowest at 1963, and maintaining a wide range of volatile wash trading. In the information-led gold price trend, any technology will look weak. However, we still need to notice that the current price is fluctuating at a high level, hitting the 1983-1988 area again, and gold prices will most likely take the opportunity to hit the record high of 1997 again. If the data is more coordinated, coupled with stronger washing ability, gold prices may stand above 2000. At that time, a double-top pattern will be formed locally, and the peak will be around 2000, which will be a good opportunity to intervene in short orders. In addition, we must also note that the MACD indicator is hovering in the overbought zone currently, and the loss ratio of short orders will be much higher than long orders. Therefore, it is recommended that investors do not make a deep pullback or go long rashly! At present, investors can still continue to buy low and sell high around yesterday's 1963-1997 range. The unstable oscillation in the near future will be the norm, especially tonight, as crucial data will be released such as core PCE, initial claims, durable goods orders, and GDP, etc. Friends who have no single order can relax in the Asian market because the European and American markets are the key competition.

Traders can mainly go short at high during the day. If the price rises to around 1997, you can still go short with small positions in the short term. The stop loss is 2002. The first target to take profit is 1977, where you can reduce your positions and move the stop loss to break even, and the second target is 1963. If the gold price rally again at 2008, you can take a short position again. This will leave the stop loss at $5. The target to take profit and the first short position are unchanged.

Trading Recommendations

Trading Direction: Short

Entry Price: 1997

Target Price: 1977

Stop Loss: 2002

Support: 1977.000/1963.000

Resistance: 1997.000/2008.000