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May 28: Gold prices may continue to fall
Gold prices continued to fall today, hitting new lows. Yesterday’s low was $4,400 and today’s low is around $4,366.
It rose from $4,366 to about $4,440, an increase of about $74. The increase isn’t dramatic, but it’s not insignificant either.
Gold prices are entering a new adjustment phase and the downward trend may continue.
The first target below is the $4320-4350 range.
💣【Analytical logic: Why does the expectation of interest rate hikes cause the price of gold to fall by US$200 within a week? 】
Key pressure: The probability of the Federal Reserve raising interest rates in December has risen to about 50%. In a high interest rate environment, the opportunity cost of holding non-interest-bearing assets such as gold has become unacceptable to institutions.
The second major pressure: institutional funds shift from gold to U.S. Treasury bonds and the U.S. dollar.
The third major pressure: geopolitical risk premiums are rapidly fading. Although the United States and Iran are negotiating in a tense atmosphere, market forces are clearly leaning towards peaceful negotiations.
The fourth major pressure: a substantial increase in money supply. The COMEX Gold Futures Fund has reduced its holdings for 7 consecutive trading days, with the total holdings decreasing by 13,022 contracts compared with the previous trading day. The holdings of the SPDR gold ETF remained flat, with no new funds entering the market.
This is not a decline, but a systematic reduction.
🎯 Real-time strategy:
Main strategy: Sell in the range of $4450-4470
Stop Loss: Above $4520 (If the price stabilizes above $4500, the strength of the downtrend will weaken)
Target: $4380-4350, below $4320
Offensive strategy: Sell directly in the range of $4430-4440, with a small position size.
Regarding the exploit: I know some people took trades very quickly after gold rebounded from $4,366 to $4,420.
But please remember:
$4,366 is today’s low, but it may not be the low of this pullback.
The 200-day moving average has been broken, and it will take time for the technical pattern to recover.
Institutional forecasts indicate that if the market continues to absorb interest rate factors, gold prices may test the lows of the $4,300-4,400 range.
Investors looking to buy should wait for a daily close above $4,400, accompanied by a strong bullish candle and heavy trading volume.
First resistance level: $4,450
Strong resistance area: $4480 – 4500 – 4520 – $4580
First support level: $4380-$4400
Strong support area: $4320-$4350
Let the data speak for itself and discipline be the guide to your profits.
Gold prices fell by more than $140 this week from $4,510 to $4,366.
An interest rate hike is imminent, and gold lacks short-term support.
This is not a “correction” but the beginning of a trend reversal.
$4,366 is today’s low, but it may not be the lowest point of this market move.
“Follow the trend” – these four words are easier said than done.
Because “following the trend” means resisting the urge to buy when prices fall and limiting losses immediately when it is most necessary to hold a losing position.