Gold Up

Gold posted some gains after the expected US dollar correction. The precious metal traded heavily on the downside last week and only on Friday did it manage to gain some strength and push through the bearish resistance to post a green candle.

Last week we saw the US dollar appreciate rapidly after comments by ECB President Mario Draghi on future outlook on EU policy. EUR/USD lost some 200 points in the day of announcement and continued to trade in the low range below 1.1580-1.1630.

Now that the US dollar is going through a correction, Gold has the chance to shine again,if only for a while. The recent gains do not seem appealing and the precious metal is still vulnerable to bear attacks. Price shoot up from $1,263 to $1,278 but now it's trading at $1,274.

If price breaks support at $1,260 then we might be heading towards long term support at $1,250. If that level is broken, then we might close the year below $1,200.

Chart: XAU/USD H4

NZD/USD Below Long Term Support

Hard times currently for the New Zealand dollar as the currency depreciated rapidly after political turmoil rattled their financial stability. The above chart is the weekly analysis of NZD/USD.

Market sentiment is overall bearish and seems to be looking for more bearish movement. A break of the current support would lead to potential further shorting opportunities. However we could see a daily lower high which would also be a nice area for a shorting position.

Below 0.68 the bearish movement is expected to continue progressing. Currently the pair is still being sold due to uncertainty and lack of stability. As soon as we have some concrete information about further political and economical development in New Zealand the pair could enjoy some buying that could recover the price to levels close to the 200SMA.

Chart: NZD/USD W1

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GBP/USD Slightly Up

The GBP/USD pair is trading slightly to the upside as price found the support needed to stabilize itself into the uptrend. The price found support at 1.3100 and then reached as high as 1.3227 before heading down to lower levels.

Currently, it's trading around 1.3200 as uncertainty still remains the predominant market emotion. We would need price to close above 1.3250 in order for the bullish move to continue. On the other hand, if price breaks the support at 1.3120 we are likely to see a continuation of the bearish short-term trend.

Major bear target is seen at 1.3050, while major bull target is seen at 1.3350. The pair has been trading sharply to the downside these past few weeks so we might be in for a corrective rally that would stabilize the price.

Chart: GBP/USD H4

Gold Close To Support

Gold is trading relatively close to the support level of $1,272 which could spark bullish interest in the precious metals driving the price up. Recently, it's been difficult for Gold to gain momentum although attempts are not lacking.

The latest move to the upside came in the beginning of October when price reached the level of $1,262 and immediately launched to what would later become a $42 rally.

Now, however, things look more uncertain as the precious metal is feeling weak in the shadow of the strengthening US dollar. As we are heading to December, the Fed is expected to raise rates again which could stimulate the US currency and create lack of demand for Gold.

Chart: XAU/USD H4

USD/CAD Breaks Resistance

The long awaited break to the upside from the USD/CAD pair has finally been done. The Canadian dollar went through a disappointing news release on Friday when retail sales turned out to be negative 0.7% instead of the expected positive 0.3%.

The effect was a massive sell off of the pair which resulted in a rally in USD/CAD. The pair gained more than a cent going from 1.2477 to 1.2637 in less than a day.

Currently, it is still gravitating towards its highest point as the pair is now above the medium term resistance that started with the downfall in the beginning of May this year.

First bull target is seen at 1.2665. If bulls take this out, next one comes at 1.2780. Important news are scheduled this week, so paying attention to fundamentals is key.

Chart: USD/CAD H4

US Index Breaks Resistance

On the daily analysis of the US Dollar Index it is clear that price has breached the medium term resistance on the downward trend. As you can see we have highlighted the market structure. Price was forming lower highs and lower lows until recent when we saw price show a break out of the trendline to the upside.

This formed a higher high as shown, price then came back to the downside and formed a higher low. Since we have seen price slowly make its way into bullish territory, showing a strong push to the upside on Friday.

Price is above the 20 & 50 EMA's with only one bullish rejection on Friday. If price continues to the upside, the 20 & 50 EMA's will cross bullish, as they are already touching. The next barrier in the way for the US Dollar index is the daily 200EMA. Then we have the 12125 resistance.

Chart: US Index D1