GOLD: Weekly Standard Deviation Report
Date Published: July 26, 2024
Author: Patrick MonteDeOca
Market Analysis Summary
Weekly Trend Momentum
Current Status: Bullish
Reason: The gold futures contract closed at 2428. This closing price above the 9-day Simple Moving Average (SMA) of 2346 confirms that the weekly trend momentum is bullish. The 9-day SMA acts as a dynamic support level, indicating a continued upward trend as long as the price remains above this level.
Negation Condition: A close below the 9-day SMA of 2346 would negate the weekly bullish short-term trend and shift the momentum to neutral. This indicates that if the price drops below this key support level, the bullish momentum would be compromised, and traders should reassess their positions.
Weekly Price Momentum
Current Status: Bearish
Reason: The market closed below the VC Weekly Price Momentum Indicator at 2436, confirming that the price momentum is bearish. The VC PMI is a proprietary indicator that helps identify market turning points and potential trend reversals. Closing below this level suggests a bearish short-term trend.
Negation Condition: A close above the VC PMI of 2436 would negate the weekly bearish short-term trend and shift the momentum to neutral. This implies that if the price moves above this level, the bearish momentum would be neutralized, suggesting a potential shift in market sentiment.
Weekly Price Indicator
Profit-Taking and Stop Levels:
If Short:
Take profits on corrections at the 2390–2353 levels. This range provides a strategic exit point for short positions, capturing profits as the price corrects to these levels.
Go long on a weekly reversal stop. If the market shows signs of reversal, traders should switch to long positions, taking advantage of the upward movement.
If Long:
Use the 2353 level as a weekly Stop Close Only and Good Till Cancelled order. This acts as a safety net, ensuring that long positions are protected against significant downside risk.
Take profits as the price reaches the 2473–2519 levels during the month. These levels represent potential resistance points where traders can maximize their gains from long positions.
Cycle
Next Cycle Due Date: 07/30/2024
The cycle due date provides a timeline for anticipating potential market changes. Traders should be prepared for shifts in market dynamics around this date, adjusting their strategies accordingly.
Strategy Summary
Short Position:
Take profits at 2390-2353. This range is ideal for capturing gains from short positions as the market corrects.
Watch for signs of a weekly reversal stop to switch to long positions.
Long Position:
Take profits at 2473-2519. This range offers an optimal exit strategy for long positions, capitalizing on upward price movements.
Use 2353 as a stop level to protect against downside risk.
Detailed Strategy Guidance
Market Analysis and Adaptation: Continuously monitor market conditions, using the 9-day SMA and VC PMI as primary indicators. Adapt your trading strategies based on the current momentum and potential reversals.
Risk Management: Employ stop levels like the 2353 level to safeguard against significant losses. Ensure that all positions are protected by good till cancelled orders to manage risk effectively.
Profit Maximization: Utilize the identified profit-taking levels (2390-2353 for shorts and 2473-2519 for longs) to optimize returns. These levels are determined based on historical data and market analysis, providing strategic exit points.
Cycle Awareness: Be mindful of the upcoming cycle due date on 07/30/2024. This date may herald significant market changes, and being prepared will allow you to adjust your strategies in advance.
By following this expanded strategy, traders can navigate the gold futures market with greater confidence and precision, leveraging key indicators and levels to optimize their trading outcomes. Stay informed, adapt to market changes, and employ robust risk management techniques to enhance your trading success.
Disclaimer: The information in the Market Commentaries was obtained from sources believed to be reliable, but we do not guarantee its accuracy. Neither the information nor any opinion expressed herein constitutes a solicitation of the purchase or sale of any futures or options contracts. It is for educational purposes only.