Gold, EURUSD & USDJPY hit Targets 1 & 2

XAUUSD, Daily              

The more hawkish than expected projections by the FOMC  for rate moves in 2017 has bolstered the USD and seen three of my targets achieved for a combined net gain of over 3000 pips.

GOLD – Two weeks ago (December 1) I noticed a key area for Gold  “Earlier today it tested and then broke the key psychological and technical $1170 level. Should this break be maintained then I would be looking for SHORT positions with an initial Target 1 at $1144 and Target 2 $1120 the widening Bollinger bands remain pointing down, the Parabolic SAR, and On Balance Volume suggest further downside potential.”.  The $1170 level did indeed prove pivotal and the clear break on December 9 saw additional volume come into to market as the price broke through $1150.  Decade-plus highs in the dollar, along with a more aggressive Fed tightening path will see gold prices remain under pressure. Target 2 remains achievable before the market targets the $1100 level in the coming sessions.


USDJPY – A day earlier (November 30) I had opened a LONG position at 113.58 with a short term Target 1 at 114.15 which was achieved during the same day. Target 2 (116.65) was realized on Wednesday for a net gain of 307 pips. The pair continued to reach and breach 118.00 yesterday. The 2016 high is the next resistance level at 121.70.


EURUSD – A post from December 9 suggested more weakness ahead for the pair. A SHORT position was entered at 1.0620 with Target 1 at the support area around 1.0550 and Target 2 at the psychological long term low at 1.0500.  Again target 1 was achieved the following day and the FED news on Wednesday helped the trade to Target 2.  Over the medium term 1.0340, 1.0160 and then 1.0000 do not seem unreasonable. Net gain on this position was 120 pips.


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Stuart Cowell

Market Analyst


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