Gold update CPI News 10.11.22
CPI measure the inflation in USA and usually there is a lot of volatility on this reading.
Macroeconomic
Last two readings showed that inflation is not going down. For two months CPI was bigger than expected and gold melted without retracement.
Last month CPI was bigger than expected and Gold melted again, but this time the drop was followed by immediately retracement.
FED announced that they will increase the IR until they see few readings, showing that inflation is going down. - NOT just one rading
In my opinion this CPI will change nothing in current environment and banks will use it only to wipe out the traders.
1) If CPI is lower or the same than expected we may see a rally, after bearish impulse
2) if CPI show more inflation than expected, Gold should drop.
Technical Analysis
Since last week Gold is in rally and showed very strong manipulation on Weekly and Daily time frame.
First confirmation for retracement - After the first bullish impulse price consolidated and rallied again. Normally if price consolidate after the first impulse, it retrace after the second one and vice versa.
Second confirmation for retracement - Yesterday Gold made false break-out and ended the day as doji.
3th confirmation for retracement - Yesterday price formed bearish manipulation on 4H time - showing us that banks are preparing a retracement.
Yesterday price reached our POI (1H manipulation zone), making a false break-out and than formed 4H bearish manipulation. Price also left huge imbalance by last rally. Last consolidation at 1680 is not retested yet. 1680 area is also very strong reaction area, where price bounced multiple times last few years. All these facts lead me that price will retest 1680 area at least one more time before next rally.
I am expecting from price to go up a bit to the 50% of a daily rejection and then will drop to 1680 area. I have multiple confirmations about this area (1680):
1- last consolidation
2- Daily manipulation zone
3- Discounted price for the banks
4- 70.5% Fibonacci retracement
5- Cluster of pivot points
VSA
As you can see last rally was made with lower volume than previous rally. It is a sign of exhaustion.
XAUUSD - GDX
It seems that price(GDX) is forming the second leg of a double top. Early sign of bearish move.
Gold and Silver
SMT Divergence is very strong sign of exhaustion. This divergence lead me that gold will drop today.
Gold - Yields
Yields broke a strong area of reaction and I think they will retrace to test it, before continue down again.
-10Y Yields formed H&S reversal pattern.
-2Y Yields bounced from the top of the channel and now is going down to test the bottom of the channel
Macroeconomic
Last two readings showed that inflation is not going down. For two months CPI was bigger than expected and gold melted without retracement.
Last month CPI was bigger than expected and Gold melted again, but this time the drop was followed by immediately retracement.
FED announced that they will increase the IR until they see few readings, showing that inflation is going down. - NOT just one rading
In my opinion this CPI will change nothing in current environment and banks will use it only to wipe out the traders.
1) If CPI is lower or the same than expected we may see a rally, after bearish impulse
2) if CPI show more inflation than expected, Gold should drop.
Technical Analysis
Since last week Gold is in rally and showed very strong manipulation on Weekly and Daily time frame.
First confirmation for retracement - After the first bullish impulse price consolidated and rallied again. Normally if price consolidate after the first impulse, it retrace after the second one and vice versa.
Second confirmation for retracement - Yesterday Gold made false break-out and ended the day as doji.
3th confirmation for retracement - Yesterday price formed bearish manipulation on 4H time - showing us that banks are preparing a retracement.
Yesterday price reached our POI (1H manipulation zone), making a false break-out and than formed 4H bearish manipulation. Price also left huge imbalance by last rally. Last consolidation at 1680 is not retested yet. 1680 area is also very strong reaction area, where price bounced multiple times last few years. All these facts lead me that price will retest 1680 area at least one more time before next rally.
I am expecting from price to go up a bit to the 50% of a daily rejection and then will drop to 1680 area. I have multiple confirmations about this area (1680):
1- last consolidation
2- Daily manipulation zone
3- Discounted price for the banks
4- 70.5% Fibonacci retracement
5- Cluster of pivot points
VSA
As you can see last rally was made with lower volume than previous rally. It is a sign of exhaustion.
XAUUSD - GDX
It seems that price(GDX) is forming the second leg of a double top. Early sign of bearish move.
Gold and Silver
SMT Divergence is very strong sign of exhaustion. This divergence lead me that gold will drop today.
Gold - Yields
Yields broke a strong area of reaction and I think they will retrace to test it, before continue down again.
-10Y Yields formed H&S reversal pattern.
-2Y Yields bounced from the top of the channel and now is going down to test the bottom of the channel
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