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Market News Cash congests the market, gold prices fluctuate within a narrow range. Fed may be forced to tighten QE (with trading strategy)

Cash congests the market, gold prices fluctuate within a narrow range. Fed may be forced to tighten QE (with trading strategy)

At midday in the Asian market on Tuesday, gold futures prices fluctuated within a narrow range around US$1,900. The market waited for the US inflation data to be released later this week to indicate the direction of the market outlook.

Eden
2021-06-08
1909

stack-of-golden-bars-in-the-bank-vault-60756080_16x9.jpg


Spot gold prices fell by US$2.49, or about 0.13%, to US$1,896.79 per ounce.

Gold futures prices rose 0.7 US dollars, or about 0.04%, to 1,899.50 US dollars per ounce.

The US dollar index futures, which measures the trend of the US dollar against six major trade-weighted currencies, rose 0.11% to 90.047.


This Friday, the United States will announce the May Consumer Price Index (CPI). This data is the last heavy economic data released by the Federal Reserve before the monetary policy meeting on June 15-16.


Analysts expect inflation to rise further. The US CPI annual rate in May is expected to climb to 4.7%, a further increase from 4.2% in April. Rising inflation may increase the Fed's pressure to reduce quantitative easing.


Global gold ETF holdings rebounded in May

According to the latest data released by the World Gold Council, the total global gold ETF (Exchange Traded Fund) holdings in May rebounded on a monthly basis, reversing the previous three-month net outflow trend, as investment demand increased with the strengthening of gold prices and market inflation concerns Once again, a weaker U.S. dollar and a fall in real interest rates also have an impact.


In May, the total global gold ETF holdings increased by 61.3 tons (approximately US$3.4 billion, and the scale of asset management increased by 1.7%, the same below); the scale of asset management (AUM) was 3628 tons (US$222 billion), compared with last August The historical value high is 9% lower and 7% lower than the tonnage high in October last year.


According to the report, large funds in the United States, the United Kingdom and Germany have once again become the dominant force in the flow of gold ETFs, and this time, unlike the past, they have dominated the trend of net inflows. During the month, North American fund holdings increased by 2%; European funds increased by 1.9%; funds in other regions fell by 1.9%.


Adam Perlaky, a senior analyst at the World Gold Council, said in a statement: "For investors, gold is still a promising asset, because market behavior continues to be controlled by inflationary pressures, coupled with the strengthening of the U.S. dollar and being diluted, real gains The decline in the rate of gold and the rise in the price of gold further illustrate this point.”


Trading strategy (Source: Trading Central)


Pivot: 1890.00


Our preference: long positions above 1890.00 with targets at 1912.00 & 1919.00 in extension.


Alternative scenario: below 1890.00 look for further downside with 1884.00 & 1877.00 as targets.


Comment: the RSI calls for a bounce.


Supports and resistances:

1924.00

1919.00

1912.00

1899.00 Last

1890.00

1884.00

1877.00


Guideline for Trading Central strategy


Trend chart reading guideline

1. First look at the time period in the upper left corner of the chart:

・30MIN and 1H chart shows the trading suggestions for intraday

・Daily chart shows the market trend analysis in next 2-3 days


2. The blue horizontal line on the chart marks the pivot: pivot indicates the reversal of the market. When the price is above the pivot, it indicates an upward trend, when the price is below the pivot , it indicates a downward trend. When the price breaks through the pivot, the trend is reversed.


3.The red and blue thin curves in the Candlestick chart chart are technical indicators: Red line is MA20+Bollinger bands, Blue line is MA50. under the Candlestick chart chart are also the technical indicators:  Blue line is RSI, Red line is 9MA;


4. The green horizontal line is the resistance level for a price increase, and is also the profit target for long orders; the red horizontal line is the support level for a price decrease, and is also the profit target for short orders.


How to use Trading Central strategy

1.Bullish is being long or buying, bearish is being short or selling.Investors can refer to the target price and set own exit goals.


2.  [Comment] is the technical analysis of market trends and technical support for trading strategies


3. Support level is a level where the price tends to find support as it falls.

resistance level is a level where the price tends to find resistance as it   

rises. 

Last: the closing price of the last Candlestick chart



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