Daily Analysis: Gold Smashed Lower Before Central Bank Meeting Again

Monday Market Recap

Asset Current Value Daily Change
S&P 500 2436 0.05%
DAX 12765 0.26
WTI Crude Oil 42.98 -0.22%
GOLD 1245.00 -0.90%
Bitcoin 2458 -6.23%
EUR/USD 1.1202 0.06%

Another important central bank meeting, now involving all the major ones, and another suspicious flash-crash happened in gold, similarly to the one before the Fed meeting two weeks ago. This could mean that someone woke up this morning and thought “Hmm I should probably sell my $2 billion of gold now, and why not at once?” Joke aside, the precious metal is back to last week’s levels and it will be crucial to see if it can get back above $1250, or another swing lower got triggered. Global stock markets are broadly higher today, despite the much worse than expected US Durable Goods Orders which pushed the Dollar lower again.

Gold’s Flash Crash, 5-Minute Chart Analysis

Oil rebounded slightly today as there is no new development in the Qatar crisis, but it remains on depressed levels and the trend is still clearly lower. Apart from the Dollar weakness currency markets are calm once again, and generally, volatility is low globally. Stocks are still close to their all-time highs, but momentum remains suspicious, and the negative summer seasonality also suggests caution for stock bulls.

Cryptocurrencies

The crypto-market remains in a deep correction, with Ethereum being down by more than 30% of its highs while Bitcoin is also trading 20% lower, near the $2500 level. All the majors are substantially lower this Monday, with Ethereum Classic and Ripple showing the most short-term relative strength, while Dash is also doing fine, holding above the $150 level. Litecoin is testing its prior all-time high after its strong move higher, while the smaller coins are also mostly down by double digits, with Bytecoin holding up well in the face of the broad decline.

Ethereum, 4-Hour Chart Analysis

Technical Picture

The S&P 500 rallied in early trading today, and but fell back to the Friday close after the US open, as stock markets remain in a low volatility, low volume limbo below their all-time highs. The benchmark failed to gain momentum after its beak-out last week, and the crucial support level near 2417 might be back in focus this week. Below that, another key level is found at $2400 while the prior high at $2450 serves as primary resistance here.

S&P 500 Futures 4-Hour Chart Analysis

Key Economic Releases on Monday

Time, CET Country Release Actual Expected Previous
10:00 GERMANY IFO business Climate 115.1 114.7 114.6
14:30 US Core Durable Goods Orders 0.1% 0.4% -0.5%

Key Economic Releases on Tuesday

Tuesday UK BOE Financial Report
Tuesday US CB Consumer Confidence 116.2 117.9

Featured image from Shutterstock

Author:
Trader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.