Intraday Market Analysis: XAU/USD and US Crude Oil – 8 June 2015

Digital Derivatives MarketsSpot Intraday Strategies

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XAU/USD Intraday Strategy

Gold suffered from heavy selling on Friday’s session following the Non-Farm Payrolls and tension in Greece. The precious metal appears to be almost completely stripped off its safe-haven characteristics at the time of this writing. Our intraday strategy focuses on the hourly chart.

Gold 60 Minutes Chart

Please click on the chart to enlarge:


As evident from the above chart XAU/USD is in the midst of an established downtrend.  In order to join the downtrend a re-test of 1,174.50 resistance  is required. Should the price re-test the resistance and fail to close above, sell orders are expected to emerge and drive the price lower. A firm break above 1,174.50 is insufficient to invalidate the downtrend but will be an indication that the market trend is due to reverse. In such a scenario a re-test of 1,178.60 is essential. Failure to break above is likely to unfold corrective weakness towards 1,174.50 that will strengthen the potential for reversed Head-And-Shoulders (H&S). A rebound from 1,174.50 that will force the price to break above 1,178.60 (neckline) may unleash moderate gains in the commodity, targeting 1,184.

Crude Oil Intraday Strategy

Despite numerous predictions from famed investment firms that suggested crude oil is unlikely to recover from OPEC’s failure to cut production several months ago moderate gains were noted in the commodity. We were in the camp of those that predicted those moderate gains in the crude oil. Similar to Gold, we are focusing on the hourly chart.

US Crude Oil 60 Minutes Chart

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Crude oil intraday strategy, 7 June 2015

Crude oil 60 minutes chart, 07/06/16

Top Head-And-Shoulders (H&S) reversal pattern was confirmed in the hourly chart, neckline noted at 59.30. The biggest technical question that arises form the development of the trend is whether the 100% objective of the reversal was reached by the market following the reversal pattern. The target of the H&S was 56.65 and the debate is whether the bearish shadow (highlighted in yellow) constitutes as the objective was in fact reached and a swift recovery is now expected. Following the bearish spike we note reversed H&S was painted, which triggered the recovery in crude oil.

The price is now facing  a moderate resistance between 59.15 – 59.30. Failure to break above may bring corrective weakness to the commodity, targeting 58.50 (reversed H&S neckline). Should the objective of the bearish objective of the top H&S was not met by the market it is likely to counter the reversed H&S and target 56.65. A break above 59.30 may pave the way for further gains towards 59.94, which provides a firmer resistance based on our technical analysis. A re-test and a failed breakout of 59.94 is likely to lead to corrective weakness towards 59.93. which would in fact create a new reversed H&S pattern should 59.93 contain the weakness. A break above 59.94 will not necessarily suggest moderate gains as the price will face multiple resistance levels while risking being in overbought terrirotires in technical indicators such as the Relative Streignth Index (RSI).

Such analysis is conducted in all our trade alerts over larger time frames but we often tend to simplify our trading strategy.

Intraday Market Analysis Outcome

XAU/USD 60 Minutes Chart

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XAUUSD intraday 1 hour chart outcome June 2015

XAUUSD intraday 1 hour chart outcome June 2015

Crude oil 60 Minutes Chart

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Crude oil Intraday Strategy June 2015

Crude oil 60 minutes chart outcome June 2015

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Last Updated on August 8, 2015