032Opportunity Analysis and Logical Analysis for goldHello traders,
This week's Thursday tip:
On Thursday, the Federal Reserve's important interest rate decision was finalized. Focus on the situation of profit-taking in gold at high levels, looking for short-term short-selling opportunities in gold on the 1-hour chart.
On the 4-hour chart, there is a clear RSI divergence, indicating that gold is oversold and there is a need for a short-term pullback.
On the 1-hour chart, wait for a reversal confirmation signal on the 4-hour chart, then look for an entry signal on the 1-hour chart to short gold!
**TP1:** 3025
**TP2:** 3005
**TP3:** 2989
On Friday during the Asian early session, after 9:30 AM, gold experienced a pullback due to the divergence on the 4-hour chart, reaching the first target of 3025. It is currently recommended to reduce positions and continue holding.
On the 4-hour chart, consider that gold may undergo a corrective adjustment in the form of an expanding triangle. Wait for the reversal confirmation signal on the 4-hour chart before looking for new entry opportunities on the 1-hour chart to short gold.
The targets for new positions remain unchanged:
**TP1:** 3025
**TP2:** 3005
**TP3:** 2989
On the daily chart, the closing of gold on Friday can provide direct guidance for next week's trend. If gold forms a new daily reversal signal on the daily chart, trading in the first half of next week can proceed with minimal interference, trending downward.
If gold experiences significant fluctuations during tonight's US session, it is recommended to wait until next Monday to enter, still opting for a strategy of buying high and selling low in the fluctuating market at the top of gold.
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**I. Three Major Drivers of Gold Fluctuations**
1. **Trump's "Face-Changing Game"**
- **Tariff Bomb:** Trump announced plans to impose retaliatory tariffs on countries like China (effective April 2), which is like throwing a bomb into the market. Concerns about a trade war resurfacing, rising business costs, and potential economic recession emerged.
- **Interest Rate Cut Talk:** Previously, Trump said, "There's no rush to cut rates," but now he has changed his tune to "We need to cut rates quickly to save the economy." The market reacted negatively: Oh no, the economy might be in big trouble! Consequently, funds shifted from the stock market to gold for safety.
2. **"Nuclear Option Expiration" in the Options Market**
- **$4.7 Trillion Bet Expiration:** This amount is equivalent to the total market value of the top 20 companies globally, and it’s settling today.
- **Market Manipulation:** Large institutions (market makers) have an incentive to push the S&P 500 index near 5800 points, as this level maximizes their options contracts' profitability. Gold and U.S. stocks often move inversely; when the stock market is manipulated, gold may suddenly surge or plummet.
3. **"Hawkish Shock" from the Federal Reserve**
- **Officials Changing Stance:** Initially, there was one dissenting voice against an interest rate cut; now it has turned into four.
- **Gold's Calculation:** A delayed rate cut → stronger dollar → temporary pressure on gold; but poor economic conditions → panic sentiment → gold benefits. These two forces are in conflict.
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**II. How Will Gold Move Tonight?**
**Key Levels:**
- **Floor Price:** $3034 (If it falls below this, it may continue to drop)
- **Ceiling Price:** $3056 (If it breaks above this, it may surge to $3080)
**Trading Suggestions:**
1. **Watch and Wait Mode:** The period between 2 PM and 4 PM (Eastern Time) will see the most volatility, so avoid making hasty moves.
2. **Buy in Batches:** If it drops to around $3040, buy 1/3 of your position; add more if it breaks above $3060.
3. **Exit Signal:** If the U.S. stock market suddenly spikes (especially if the S&P approaches 5800), gold could drop by 2% instantly.
If you prefer not to stay up late, you can skip trading tonight, maintain a flat position, and look for opportunities on Monday!
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**III. Grandpa Munger's Survival Guide**
- **Being Flat is a Superpower:** Just like in poker, if you find your hand is bad, fold and don’t call.
- **Wait for Clear Signals:** Gold is currently in a "Schrödinger's state" (it could rise or fall); it’s better to wait for it to break above $3056 or drop below $3034 before taking action.
- **Historical Lesson:** On the options expiration day in September 2023, gold fluctuated by $100 in one day, leading to numerous liquidations. Today may very well replicate that scenario.
GOOD LUCK!
LESS IS MORE!
