Besides of Crude oil, I trade Gold in a long-term approach. That said, I will simply write a post with my observations on this lovely yellow market in the same format as for Crude oil. Please keep in mind that I analyze the Gold Futures contract here and not the XAU/USD (Gold / US Dollar) market. It’s quite the same but thought to mention this little detail.

Firstly, let’s take a look at the plain macro perspective with a simple yearly candlestick bar chart. Looking at this, we can identify a possible balance area, inside of it the market currently seems to be heading towards the bracket high. Same as for Crude oil, keep in mind the geopolitical conflict news which could “support” our theory for higher prices.

For the sake of enjoyment, I will throw in a really nice macro chart of XAU/USD. From 1793 to today’s date:

Now then, let’s move forward to the more serious charts for our trading. The daily perspective is one-time-framing lower in some kind of a bumpy way. Surely, some special political shouting leads to this kind of structure or context. Anyway, it seems the market leaves us with an inside day. We will simply apply the inside day rules in this case. Looking at the patterns and the current formation I am more on the bullish side of this market.

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Glaring at the weekly volume profiles, the market broke below the previous weeks balanced profile which should indicate a bearish trading behavior. However, the market broke into a liquidity area and a previous acceptance area which are confluent with VWAP levels. Actually, the weekly VAL close level from that profile is supportive currently. With that said, I took long trades here.

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Next is the VWAP chart but there is not much to talk about. The market moves around here in a rotational small range manner which indicates to me that some bigger market participants are in a battle. That’s the calmness before today’s Fed stuff. Please note, that the yellow lines are buying levels for me.

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Last but not least, let’s take a look at the QuickStrike tool on CME’s website on the managed money sector for Gold. Well, since July we clearly see an increase of long positions. To be honest, kind of worried about possible long liquidation (close long positions) as the net position is kind of too high.

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We’ll see how things play out and adjust the game plan accordingly. Wish you a great week in this market.