The timing of yesterday’s gold sell-off wasn’t too surprising, if things happen in the dear XAU market it’s on Tuesdays or thursdays shortly after the US markets open. The slide and market action was this avalanche unloading that seems reasonable in hindsight but where the signs were ignored beforehand and I made a ridiculous call on this blog for 1880 representing a floor. Forget that and chalk that down to me being unable to foresee how much risk money is placed in gold and needed to flow elsewhere on the market rally.
But here’s the hint for today. A massive flag pattern has formed with that fall yesterday. The momentum indicators are a little bit in discord over different time frames, and there are clear posts in both MA’s and previous peaks, troughs and trend lines, and price is right now oscillating at the very edge point of that triangle.
Expecting very strong market action on this, but could go either way. my bet is up (bearish mode at the moment, lack of positive fundamental news, Fed speculation) but it could be a down swing towards the earlier 1725 region mentioned at the very start of last week. Your call. Anyway, we’ll likely get a very wacky Wednesday, which is rather uncommon. Just keep that in mind and keep your stops tight.