GLOBAL TRENDS WEEKLY

Gold Market Standard Deviation Report

Date: December 29, 2024,
Prepared by: Patrick MontesDeOca
Target Audience: Gold Market Analysts, Traders, and Investors

Weekly Gold Futures Analysis (Week Ending December 27, 2024)

Market Overview Gold futures closed at $2,632, down from previous highs, reflecting bearish sentiment. The market remains under pressure as it trades below key technical levels, indicating a cautious outlook. Key support and resistance levels, along with upcoming cycle dates, are critical for guiding trading strategies.

Trend Momentum: Bearish

  • Market Close: $2,632 (below 9-day SMA $2,676).
  • Outlook: Bearish unless price closes above $2,676.

Price Momentum: Bearish

  • Market Close: Below VCPMI at $2,637.
  • Outlook: Bearish unless price closes above $2,637.

Technical Indicators Bollinger Bands:

  • Current Range: Upper Band $2,685, Lower Band $2,589.
  • Signal: Price near the lower band suggests potential oversold conditions and possibility for a reversal.

RSI (Relative Strength Index):

  • Current RSI: 41 (Neutral to Bearish).
  • Signal: RSI indicates weakness, approaching oversold territory but not yet at extreme levels.

MACD Analysis:

  • MACD Line: 2.561
  • Signal Line: 2.452
  • Histogram: 0.109
  • Signal: Positive momentum has weakened but no clear reversal signal yet.

Mean Reversion Model:

  • Mean Price: $2,637.
  • Signal: Price trading below mean supports bearish bias but hints at possible mean reversion higher.

Trading Levels Short Positions:

  • Profit Targets: $2,618–$2,604.
  • Reversal Signal: Close above $2,676.

Long Positions:

  • Stop: $2,604 (monthly close-only).
  • Profit Targets: $2,651–$2,670.

Cycle Date:
December 30, 2024, Expect volatility and trend shifts around this date, potentially triggering price reversals or breakout opportunities.

Fundamental Analysis Key Drivers:

  • Interest Rates: Hawkish Federal Reserve policies maintain pressure on gold as higher rates increase opportunity costs.
  • Inflation Trends: Moderate inflation levels reduce demand for gold as a hedge.
  • Geopolitical Risks: Persistent geopolitical uncertainties provide some support for gold as a safe-haven asset.
  • U.S. Dollar Strength: A strong dollar continues to cap gold’s upside potential.

Supply and Demand Factors:

  • Central Bank Purchases: Ongoing purchases by central banks provide underlying demand support.
  • Mining Output: Stable production levels are expected to meet current demand without significant supply shocks.
  • Industrial Demand: Growing demand for gold in electronics and renewable energy sectors provides additional support.
  • Jewelry Demand: Seasonal trends and global festivals are expected to maintain moderate demand.

Economic Outlook:

  • GDP Growth: Slower growth in major economies could boost gold demand as a hedge.
  • Employment Data: Strong employment data may weigh on gold, while weaker data could provide support.
  • Fiscal Policies: Government spending programs and deficits may influence investor sentiment toward gold as a safe haven.

Strategy Summary

  • Shorts: Target $2,618–$2,604; reverse if above $2,676.
  • Longs: Target $2,651–$2,670; stop at $2,604.
  • Monitor December 30 for key movements and volatility.

Risk Management

  • Stop Loss: Maintain stops at critical levels to limit downside risks.
  • Position Sizing: Adjust position sizes based on volatility expectations leading into the December 30 cycle date.

Conclusion: G
old futures are trading within a bearish framework with key resistance and support levels providing strategic entry and exit points. The upcoming cycle date on December 30 could introduce increased volatility, making it crucial for traders to stay disciplined and adhere to risk management strategies.

Disclaimer:
This analysis is intended for informational purposes only and should not be considered as financial advice. Traders should conduct their own research and consult with a financial advisor before making trading decisions.