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FxWirePro: Gold bulls take support at 7-DMA to maintain 4-month highs, more rallies likely on bullish DMA and EMA crossover – boundary binaries to speculate

In an intermediate uptrend, gold prices have almost retraced upto 61.8% from the lows of 1046.54 to the recent highs of 1263 levels in the consolidation phase, but for, this Fibonacci level has acted as a stiff resistance and the failure swings have evidenced the price drops to the current 1203.31 levels (refer monthly charts).

On daily charts, the current prices are attempting to bounce above DMAs, rallies are most likely to extend further on bullish DMA crossover and momentum now seems to be intensifying, while both leading and lagging oscillators are in conformity to the buying pressures.

RSI and stochastic curves are converging to the price spikes to indicate the strong buying momentum.

While current prices on these timeframes have consistently sliding below DMAs and EMAs, MACD on the other hand also evidences bullish crossover that is again one more indication of uptrend continuation.

To substantiate this stance, 7EMA has attempted to cross above 21DMA which is again bullish signal.

Any abrupt dip, next strong immediate support is seen at 1248 region (i.e.7DMA).

Fundamentally, Federal Reserve’s dovish stance in rate hiking standpoint is intensifying the bearish sentiments in dollar which is in turn conducive for bullion markets.

For an intraday speculation, we advocate buying boundary binaries, on an intraday trading perspective, boundary binary barriers with upper strikes at 1259.3123 and lower strikes at 1248.

The trading between these strikes likely to derive certain yields in this puzzling trend and more importantly these yields are exponential from spot movements.

For cash or nothing, these options would be exercised if the forward prices to remain between both strikes (i.e. 1248 > Fwd price > 1259.3123).

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