gold futures

A Challenging Month For Gold

Posted Monday, September 30, 2019 by
Shain Vernier • 1 min read

From a fundamental standpoint, there aren’t a whole lot of reasons to be divesting in gold. But, that is exactly what we have seen throughout September. Given concerns over global economic growth, and now a pending Trump impeachment, one is inclined to expect a bull market for bullion. Is October the month gold begins its treck toward $1600.0 and beyond?

Perhaps. However, for the month of September, December GOLD futures fell more than $40.00 per ounce in the wake of growing uncertainty. A dovish FED, Brexit, and questions surrounding American political stability should have helped values hold serve at the very least; they did not. At this point, a test of the 6-month month bullish trend appears to be a possibility by November 1.

December Gold Futures Extend Losses Beneath 1500.0

The 5000-pound elephant in the room for December gold futures has been the 1500.0 psychological barrier. This area has drawn heavy two-way action for a majority of the past month. Going into October, a significant deviation from 1500.0 is likely.

December Gold Futures (GC), Daily Chart
December Gold Futures (GC), Daily Chart

For October, there is one key level to circle and be aware of:

  • Macro Support(1): 38% May/August Bull Run, 1458.8

Bottom Line: In the event the current bearish pressure on gold extends, a position trade from the 38% Macro Retracement will set up. Until elected, I will have buy orders queued up from 1469.9. With a large initial stop at 1439.9, this position trade yields 300 ticks on a return to 1500.0.

Right now, there are dozen fundamental reasons to be long gold. With a bit of luck, an opportunity to buy a sizable dip will present itself in the coming weeks.

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