China’s Olive Branch Diminishes Trade War Tensions | The Gold Forecast

China’s Olive Branch Diminishes Trade War Tensions

August 29, 2019 - 6:57pm

 by Gary Wagner

Gary S. Wagner - Executive Producer

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Gold Forecast: Proper Action

We are currenly flat with no active trades after pulling profits of $813.00 per contract today on our long gold when the stop was hit.

In at $1524 Out at $1532.13 for a profit of $813.00

Gold Market Forecast

This is unquestionably a market firmly entrenched with fundamental events as the major underlying force moving prices from day-to-day. While technical indicators are excellent for charting support and resistance levels, for defining when a market is oversold or overbought there is a huge caveat. As explained me over a cup of coffee by Larry Williams, legendary market analyst and trader as well as the creator of the Williams %R; using technical indicators is similar to someone standing at the end of the boat in motion and looking at the wake of the rudders to determine where the ship is headed. However, it must be realized that only the captain knows when he will turn the wheel.

This story is always stuck in my head in that technical indicators for the most will lag behind the real market action. This is why over the last 30 years I have assembled what I believe to be truly forward-looking technical indicators which include Elliott wave theory, Fibonacci retracement and candlestick chart patterns. Any indicator based upon a moving average is looking backwards in time to attempt to forecast where a market will be in the future.

That being said the captain turned the wheel today with the statement from the Chinese which dramatically a profoundly changed current market sentiment. From this point we need to see if this is the beginning of a de-escalation or just hollow words that will not stand the test of time.

Sentiment Indicator:
Gold -> Neutral
Silver -> Neutral
S&P 500 -> Neutral
Bitcoin -> Neutral
Bitcoin fundamentals by Joseph M. Wagner II:

Bitcoin’s recent drop in price over the last three days especially the 5% fall on Aug. 28 coinciding with $144 million long positions being terminated on the BitMEX exchange. Analysts such as David Balter of Flip-side Cyrpto believes this sell off could have been due to the CME’s BTC futures contract set to expire in one day on Aug. 30, “From our end, it looks like it was a sell-off to cash settle futures that are coming due on Friday for BTC,” Balter told Fortune.

Whatever the reason for the recent decline of approximately $800, (which in this particular market is not even a moderate price swing) bitcoin is still clearly still trading in its defined $1200 range. Ever since the break below the 50-day Moving average on Aug. 20 BTC has had strong support at $9500 with a ceiling at the $10,700 level.

With volume at low levels whales or buyers and sellers of huge amounts of BTC can have an even more noticeable effect of being able to move the price with huge short or long positions but even though pricing has held onto the key level of $9,500.

The many technical indicators that last week were starting to turn south have now officially done so. BTC is now below not only the 50 but 100-day M.A as well this has not happened since Feb. 18th of this year. Not only that but the RSI is sitting at 40 right at the line for being oversold and the last time it dipped below this number was in Dec. 2018 and correlated with a drop in price over $3000.

Regardless as we previously wrote a break below $9500 is needed before we would be bearish, likewise a break above $10700 would make us bullish so until one of these areas is taken out we remain neutral.