Złoto / Dolar USAShort
1216 Weekly outlook GOLD
Zaktualizowano
Hello traders,
December highlights, the last heavyweight data week before Christmas, the Federal Reserve may cut interest rates!
The Federal Reserve will announce its interest rate decision and economic projections this Thursday (03:00), followed by a press conference at 03:30 led by Chairman Powell.
Currently, market consensus indicates a 97% probability that the Federal Reserve will cut rates by 25 basis points at its meeting on December 17-18. Importantly, the market expects that after this rate cut, the Fed may begin to pause rate cuts in early 2025. Therefore, Powell's remarks and the latest economic forecasts will be very significant, as the Fed may slow down the pace of rate cuts.
With this trend expectation, the inverse correlation of a weakening gold and strengthening dollar has already re-emerged.
The latest daily chart of gold compared to the dollar shows that the dollar has consistently remained above the daily EMA and is currently in a consolidation phase, poised for an upward move.
Gold is supplemented with this latest daily chart from Monday, which shows a double-top bearish pattern. Currently, the bears are dominant, and the daily candlestick chart is running below the EMA.
Scott Rubner, a senior capital flow expert at Goldman Sachs, may provide some insights into capital flows before Christmas:
First, the impact of global, especially the Federal Reserve's, interest rate cut expectations. With the market generally expecting a 97% chance of a rate cut at the Fed's December meeting, this could stimulate investors' risk appetite. Rate cuts usually mean lower borrowing costs, which promotes consumption and investment, thereby driving up the stock market.
Second, the so-called annual "Santa Claus rally." The "Santa Claus rally" refers to the seasonal rise in the market at the end of each year, driven by holiday spirit and investor optimism. If the market's expectations for rate cuts are confirmed, there is indeed a higher likelihood that the S&P 500 index will rebound in the last few trading days of 2024.
Third, the impact of year-end corporate buyback plans on market capital flows. Corporate stock buybacks are an effective means of driving up stock prices. When companies announce large-scale buyback plans, the market usually interprets this as confidence in the company's prospects, which also boosts investor confidence. It is reported that U.S. companies have approved stock buybacks worth $1 trillion by 2025, which could also drive the stock market significantly higher!
As risk assets strengthen, investors' risk appetite typically increases. Gold does not generate interest or dividends, so the opportunity cost of holding gold rises. Investors are likely to prefer allocating funds to higher-risk, higher-return assets like stocks rather than traditional safe-haven assets like gold. A weakening of gold before 2025 is highly probable.
**Gold**
The bullish plan for gold laid out before last Thursday has completed its trading plan, with all profit targets reached. The trading plan from last Thursday aimed to continue the previous upward trend, looking for new bullish entry opportunities. 2690 was identified as a support level for entering long positions, but it became a resistance area on Friday.
After no bullish entry signals appeared on the 1-hour chart on Thursday, the updated trading plan based on the latest 4-hour chart is as follows:
**Friday 4-hour chart trading plan:**
Before the U.S. market opens, look for 1-hour entry signals to short gold.
TP1: 2648
TP2: 2618
TP3: 2575
Currently, the first target of 2648 has been reached; it is best to move the stop loss to the entry position and continue holding the short position. Considering the above 4-hour chart, wait for new consolidation signals; before this week's critical data and time points, gold will likely continue to decline, so patience is key!
GOOD LUCK!
LESS IS MORE!
December highlights, the last heavyweight data week before Christmas, the Federal Reserve may cut interest rates!
The Federal Reserve will announce its interest rate decision and economic projections this Thursday (03:00), followed by a press conference at 03:30 led by Chairman Powell.
Currently, market consensus indicates a 97% probability that the Federal Reserve will cut rates by 25 basis points at its meeting on December 17-18. Importantly, the market expects that after this rate cut, the Fed may begin to pause rate cuts in early 2025. Therefore, Powell's remarks and the latest economic forecasts will be very significant, as the Fed may slow down the pace of rate cuts.
With this trend expectation, the inverse correlation of a weakening gold and strengthening dollar has already re-emerged.
The latest daily chart of gold compared to the dollar shows that the dollar has consistently remained above the daily EMA and is currently in a consolidation phase, poised for an upward move.
Gold is supplemented with this latest daily chart from Monday, which shows a double-top bearish pattern. Currently, the bears are dominant, and the daily candlestick chart is running below the EMA.
Scott Rubner, a senior capital flow expert at Goldman Sachs, may provide some insights into capital flows before Christmas:
First, the impact of global, especially the Federal Reserve's, interest rate cut expectations. With the market generally expecting a 97% chance of a rate cut at the Fed's December meeting, this could stimulate investors' risk appetite. Rate cuts usually mean lower borrowing costs, which promotes consumption and investment, thereby driving up the stock market.
Second, the so-called annual "Santa Claus rally." The "Santa Claus rally" refers to the seasonal rise in the market at the end of each year, driven by holiday spirit and investor optimism. If the market's expectations for rate cuts are confirmed, there is indeed a higher likelihood that the S&P 500 index will rebound in the last few trading days of 2024.
Third, the impact of year-end corporate buyback plans on market capital flows. Corporate stock buybacks are an effective means of driving up stock prices. When companies announce large-scale buyback plans, the market usually interprets this as confidence in the company's prospects, which also boosts investor confidence. It is reported that U.S. companies have approved stock buybacks worth $1 trillion by 2025, which could also drive the stock market significantly higher!
As risk assets strengthen, investors' risk appetite typically increases. Gold does not generate interest or dividends, so the opportunity cost of holding gold rises. Investors are likely to prefer allocating funds to higher-risk, higher-return assets like stocks rather than traditional safe-haven assets like gold. A weakening of gold before 2025 is highly probable.
**Gold**
The bullish plan for gold laid out before last Thursday has completed its trading plan, with all profit targets reached. The trading plan from last Thursday aimed to continue the previous upward trend, looking for new bullish entry opportunities. 2690 was identified as a support level for entering long positions, but it became a resistance area on Friday.
After no bullish entry signals appeared on the 1-hour chart on Thursday, the updated trading plan based on the latest 4-hour chart is as follows:
**Friday 4-hour chart trading plan:**
Before the U.S. market opens, look for 1-hour entry signals to short gold.
TP1: 2648
TP2: 2618
TP3: 2575
Currently, the first target of 2648 has been reached; it is best to move the stop loss to the entry position and continue holding the short position. Considering the above 4-hour chart, wait for new consolidation signals; before this week's critical data and time points, gold will likely continue to decline, so patience is key!
GOOD LUCK!
LESS IS MORE!
Zlecenie aktywne
Waiting for new order flows to push prices south.
9hrs later, the Fed's interest-rate decision comes to unlock the order flow.
Uwaga
TP1 & TP2 hit!!Transakcja zamknięta: osiągnięto wyznaczony cel
Uwaga
Dont try to open long in short time.
Based on 4h chart, GOLD could drop down more to new low before 2025.
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signalsofswingtrading.com
Wechat: ziyuvera
Tele: t.me/VeraFuntrader
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