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Gold – What is driving the Price action?

September is a surprising month for commodity traders, Price Action of Gold, Silver, Crude oil are moving unexpected and less predictable. Gold’s performance diverged from the market structure, yet long-term price behavior still intact. The strength of the dollar is a driving reason for gold prices from last few weeks; evidentially prices fell on Thursday after US dollar strengthened, when ECB left the rates unchanged. The Support zone is at 1310.00 and resistance zone at 1375.00.

Gold Technical Analysis | Trend Termination in Play

Price Action terminated the trend in the beginning of September

Price action took support at 1310.00 in the beginning of September and eventually broke the trend line on 4hr chart. The movement was due to accommodating monetary policy stances which favor safe heaven assets. Gold attracted influx of buying pressure and caused constant liquidation creating an optimally positive environment. Strong impulsive upswings took prices till 1350.00, but the metal gave up much of its strong gains recently. Long term Market structure is still intact.

Gold Price Action Trading within the Range on Daily chart

 Technical Analysis |  Gold trading within the range on Daily chart

Gold’s range bound structure remains in force, and movements in either side will be gradual. The picture becomes clear if we observe the daily chart. The structural high is at 1375.00 and structural low is at 1310.00, these levels might act as prudential support and resistance levels. Investors are looking ahead for policy moves by major central bankers to allocate portfolios accordingly. Gold is driven by US Dollar movements and global central bank policies. Technically traders should focus on the market structure in daily chart.

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About the Author:

Balaji is a Speculator, Investor and Trader (All in All!!!) and self published author. Trading in the Markets since decade, have seen more ups and downs along with institutional trader's lifestyle. He usually trades Nifty, Bank Nifty, Commodities, Futures cum Options around both Indian and global Markets. Balaji applies highly analytical and systematic Price Action strategies He blogs passionately about Trading strategies, Price Action Trading, Technical analysis, Macro events, Market setups, Financial and Economical topics. Apart from Trading and Blogging, Balaji also mentors aspiring Traders and Investors on becoming successful in highly competitive financial Markets.

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