XULF Report 9th April

XULF Report 9^th April

Fundamentally the landscape for gold does not look good for bulls at present. The BoJ exceeding stimulus expectations will have a prolonged affect as Japanese exporters boost revenue via a weaker yen which in turn will bolster other major economies such as China and the US. So from a USD/JPY perspective and from the view that the knock-on effects should increase global growth means gold is in a forthcoming hindering environment. However it is not a foregone conclusion that the BoJ will be able to induce inflation in Japan therefore it isn’t all doom and gloom for bulls, plus there are many other bullish factors from a macro-economic angle that can support the yellow metal.

The overall bearish trend illustrated by the daily chart is congruent with the fundamental picture. There will obviously be bullish opportunities as price fluctuates and creates counter trends although at the moment profit maximisation will occur trading with the overriding downward trend. If looking for longer term trades consider executions when price interacts with the upper Bollinger band. It is visible that when this has occurred previously a decline has followed shortly after. Incorporate candlestick information before shorting with this indicator.

Taking a closer look at the short term the pivotal point for today’s direction is $1575.5 as price makes contact with this recent bearish trendline. Wait for candlestick confirmation around this level before executing a short and target $1567 which is the major low on the 15 minute chart. A break through this bearish trendline could lead to further gains although any ascent is likely to be lacking energy especially given the absence of gold moving economic figures due for the rest of the day. The bullish target for today if price penetrates $1575.5 will be just shy of Friday’s high at $1581.