Weekly Gold Analysis

Last week, I said we should see price move up due to the selling climax we saw on Friday morning, and again, I was proved right with price moving up $50 from Monday's low to Friday's high, right into the supply zone created from the fall from last week's high.

I am still of the opinion that price will continue to go up, due to strength being in the market with the aggressive buying seen on NFP day and the climax selling seen last Friday.

Price is currently just below the supply zone from last week's high, but it is consolidating, and in my opinion, the supply is being exhausted.  I could be wrong about this, but if we see a break out with volume and speed above the supply zone, then, I expect the 1700 level to be hit by the end of next week.

I have used the 5K volume and the 30 min charts to show the overview of price action this week and also used the 1K volume chart to show intraday action, including the intraday demand zones.

As my bias was to the long side I expected that intraday demand zones would work better than the supply zones, and so this proved.

We saw that price gapped up on Sunday into a supply level from the 5K vol chart and retraced back down to a demand zone, in a corrective manner and made an impulsive up move.  But retraced in a corrective manner on Tuesday.  We got a great opportunity to go long at a demand level created the previous day, when we see demand coming back into the market with aggressive buying on the corrective down move.

Friday was a bit wild, being quad witching (options expiry) day, where we saw a 150 tick up and down move within 30 minutes.

On the 5K vol chart I have used a fuschia box for the S&D levels and a darker box on the 1K vol chart to show the intraday levels.  Again, the S&D levels usually have a RPM element to them, and that is why the RPM is so important helping me to identify these zones.

For this purpose, see the last chart of the 400 Vol chart where I have identified a very strong demand zone created on Thursday evening, where we see several RPM bars breaking out of a basing zone.  We then see price retracing early Friday afternoon on the opening of the COMEX and shoots up 150 ticks in 10 minutes and then retraces the same amount back into the demand zone 20 minutes later, and then rallies another 120 ticks from there. 

You will notice that price stopped at a supply zone from the larger 5K vol chart, which I expect to be breached sometime early next week.  So this is the reason for using the RPM to identify the S&D zones as taught by OTA XLT.

Here are the charts.