SAMT Blog
GOLD : too early to buy
02. March 2023, by Bruno Estier
Technical Analysis
Gold’s daily chart displays a gradual down-drift after the two sharp down days, which broke the rising channel near 1900 at the beginning of February 2023. The decline has been gradual after Gold broke below 1877, the Fibo 38% retracement, which often signals a change in trend. Below 1847, the Fibo 50% retracement, Gold entered into the Cloud, which extended between 1800-1780 at the end of February, where it could find some support and rebound toward 1847. This may correlate with the US$ Index (dotted green line) on the upper panel finding some resistance near 105 – the former support level of last November.
However, this rebound of Gold toward 1847 would be a rebound within a neutral zone as the Cloud defined itself, or a Bear market rally later leading to lower lows. Indeed if Gold is drifting below 1800 during March, i.e. drifting below the daily Cloud, it would confirm the bearish trend along a negative MACD allowing Gold to drift toward 1719, the former major low in November 2022. Therefore, right now near 1817, it is too early to consider buying Gold along oversold Stochastics as a rebound may be too short-lived. It would be better to wait for price action near 1719. Indeed, Patience is a virtue in the domain of Investing.
About the author
Bruno Estier is an Independent Market Strategist and founder of Bruno Estier Strategic Technicals (bruno.estier.net). Based in Geneva, he is a global market advisor and technical analyst coach for professional traders and portfolio managers.
He is a past president of the Swiss Association of Market Technicians (SAMT) and served on the board of directors as chairman and secretary of the International Federation of Technical Analysts (IFTA). Bruno holds a MSTA from The Society of Technical Analysis (STA) in London and the CFTe and MFTA designation from IFTA.
He worked for 12 years as a technical analyst with JP Morgan in Zürich and Paris and 10 years with Lombard Odier & Cie in Geneva. He earned an MBA from The University of Chicago Graduate School of Business and a Masters in Economics from the University of Saint Gallen (HSG).
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