Oct 11th: Gold, Oil Rebound; How Far Will This Rally Go?

Yesterday's judgment on gold and crude oil was generally correct in terms of overall direction, but the specific point judgment for gold was a bit too conservative. The gold price plummeted significantly under the influence of CPI data, briefly breaking below the 2600 mark, and then rebounded again. As for crude oil, it was very clear that the price has turned into an upward trend, and any pullback is an opportunity to go long. The oil price increased by nearly 3% yesterday, which also verified the judgment in terms of direction.

Many investors may have a question: has the rebound in gold prices ended? Can they reach new highs again? I still adhere to my previous view that after the first top pattern appears in gold prices, there will be a short-term pullback followed by a possible rebound. Regardless of whether this rebound can set a new high, if a second top pattern appears, it could become a significant top in the medium to short term.

First, let's look at gold.

Gold prices closed with a small positive candle yesterday, forming an engulfing pattern against Wednesday's negative candle. Today's high also broke through yesterday's high, suggesting a possible short-term rebound and a temporary halt to the decline.

Looking at the 1-hour chart, it is still dominated by positive candles, with the strength of the positive candles being stronger than that of the negative ones. Additionally, both the opening of the New York session yesterday and the opening of the European session today were dominated by positive candles, so the intraday direction may still be primarily upward.

On the 5-minute chart, the gold price's pullback broke below the support level at the bottom of the consolidation range at the beginning of the European session, which might lead many to mistakenly believe that the trend has turned downward. However, this is more likely a normal short-term pullback and is not sufficient to disrupt the upward trend. If the price can pull back to around 2630 at 8 PM and 9 PM Beijing time, there might be an opportunity to go long, with a stop loss below 2625 and take profit near 2645 and 2650.

Next is crude oil, also known as USOIL.

Crude oil continued to rise yesterday, and for many investors, floating profits may be more difficult to hold onto than floating losses, fearing the return of profits. In fact, after the rise yesterday, it is normal to see a pullback today. If your goal is short-term, you can consider raising the stop loss to near the entry price or closing a small portion of your position.

On the 1-hour chart, the inflection point was established when the price broke through the small high near 73.979. The current pullback has also come to this small high support level. Although it is not likely to rebound immediately here, if there is a second pullback in the evening and it holds steady, there will be an opportunity to move towards 75.58 and 77.78 again.In a 15-minute chart, if the price retests the support line near 73.86 and the support within the FVG region, there could be a potential for further rebound. This area might present an opportunity to re-enter in the short term, with a stop loss placed below 73.21 and take-profit levels near 75.58 and 77.78.