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High probability of pair growth.
On the daily chart, the development of the third wave of the higher level (3) of 3 has begun, in which the first wave of the lower level 1 of (3) has formed and the local correction continues to develop as wave 2 of (3). At the moment, wave c of 2 is being built, within which the formation of the fifth wave of the lower level (v) of с of 2 is being completed.

If the assumption is correct, the price of XAGUSD will continue to move towards the area of 24.12 - 26.2. The level of 21.4 is critical and stop-loss for this scenario.

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#1 - May 03, 2022, 07:47:59 AM

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XAUUSD, the instrument rushed to local lows
Gold prices are consolidating near the level of 1865 after an attempt at corrective growth the day before, which did not allow XAUUSD to consolidate on new local lows from February 16. The pressure on quotes is exerted by the growth in the yield of US Treasury bonds: the indicator for 10-year bonds last Monday exceeded 3% for the first time since December 2018 and remains in this area at the present time.

The investment attractiveness of the precious metal is decreasing before the start of the US Federal Reserve's meeting on monetary policy, which will be held today at 20:00 (GMT+2). US officials are expected to raise interest rates by 50 basis points at once, and also announce the launch of a quantitative tightening program, which should help to reduce the almost 9 trillion dollars balance sheet. Higher short-term interest rates and US bond yields tend to increase the opportunity cost of holding zero-yield bullion.

This week, the Bank of England will also hold a meeting on monetary policy, which will allow it to maintain parity, but the European Central Bank (ECB) again looks somewhat apart from this background. The regulator has not officially announced plans to tighten monetary policy, but its representatives have repeatedly spoken out in favor of such a scenario. In particular, Isabelle Schnabel, a member of the executive board, commenting on the problem of growing inflation in the region, noted that she allows the launch of a program of gradual rate increase as early as July this year.

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On the daily chart, Bollinger Bands are steadily declining. The price range is changing slightly, but remains rather spacious for the current level of activity in the market. MACD is also decreasing, maintaining a relatively strong buy signal, being located below the signal line. Stochastic, having demonstrated an unsuccessful attempt at corrective growth is again reversing into a downward plane, still indicating the risks of the instrument being oversold in the ultra-short term.

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#2 - May 04, 2022, 08:36:24 AM

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Despite the fact that the US Fed has moved to a decisive tightening of monetary policy and yesterday raised the interest rate immediately by 50 basis points to 1.00%, commodities reacted to this with an increase in quotations. Most likely, traders put the regulator's decision in the prices of trading instruments long before the official announcement. Since the analysts' forecast on the adjustment of the rate value was justified, the USD began a downward correction.

An additional factor that prevented the exchange rate of the XAG/USD pair from continuing the April decline is the restoration of production processes in China. While cities such as Shanghai and Beijing continue to adhere to the principles of a dynamic zero tolerance policy for COVID-19, regardless of the economic costs, Hong Kong announced the easing of anti-COVID measures from May 5. On Monday, the number of new cases of coronavirus infection in the metropolis fell below 300 for the first time in almost three months ? to 283. Thus, from May 19, cafes, nightclubs and some other establishments that have been closed since the beginning of the year, when the fifth wave of the epidemic covered the country, will resume work. Against this background, we can count on the fact that other large cities will gradually open up, and this, in turn, will support the demand for precious metals.

The long-term trend remains upward. Last Monday, the bidders tested a strong support level of 22.20, which was held, after which the price of the XAG/USD pair rose to the resistance level of 23.25. If this level is broken out, the upward trend will continue with a target at 24.25.

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The mid-term trend is downward. As part of the decline last week, the quotes reached the target zone 2 (23.14?22.95). This week, the "bears" tried to break it, but the price returned to the area of 23.14?22.95. In case of consolidation above the range, the upward correction will continue with a target at the trend boundary of 24.06?23.89.

Resistance levels: 23.25, 24.25, 26.1 | Support levels: 22.20, 21.45

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#3 - May 05, 2022, 12:56:12 PM

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On the daily chart, the development of the third wave of the higher level (5) of 3 continues, in which wave 3 of (5) has formed. At the moment, there is a downward correction as the fourth wave 4 of (5), within which wave c of 4 is being formed.

If the assumption is correct, after it is finished, the growth of XAUUSD will continue to the levels of 2100 - 2200. The level of 1827.33 is critical and stop-loss for this scenario.

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#4 - May 06, 2022, 07:52:17 AM

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On the daily chart, the development of the third wave of the higher level (3) of 3 started, within which the first wave of the lower level 1 of (3) formed, and a local correction developed as the wave 2 of (3). Now, the wave c of 2 has formed, within which the fifth wave of the lower level (v) of c of 2 has developed.

If the assumption is correct, the XAGUSD pair will move to the area of 24.12 - 26.2. In this scenario, critical stop loss level is 21.4.

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#5 - May 09, 2022, 07:38:32 AM

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Gold prices show moderate corrective growth, consolidating after an active decline yesterday, returning the XAU/USD pair to the local lows of May 3. Currently, the instrument is testing 1860, receiving support from technical factors.

The strengthening dollar and the growth in the yield of US Treasury bonds put pressure on the positions of the metal. Thus, the underlying 10-year securities reached 3.185%, which is the highest level since November 2018, but now, it has corrected to the area of 3.040%, while the USD Index exceeded the high of December 2002 at 104.120, but now it has fallen to 103.590. Also, last week, the US Federal Reserve expectedly increased interest rates by 50 points to 1.00% and announced the start of a phased reduction in its balance sheet. In subsequent comments, the head of the regulator, Jerome Powell, dispelled reports that in the future, officials could accelerate the pace of monetary tightening and, for example, adjust the rate by 75 percentage points. Against this backdrop, gold quotes are supported by the prospects for continued growth in consumer inflation in the US during the current quarter, although it has already reached its highest level in 40 years, around 8.5%. Tomorrow, American investors will be watching the April statistics, which may show the first signs of weakening. In particular, it is assumed that the consumer prices will be only 0.2% MoM after rising by 1.2% for March and may fall 8.5% to 8.1% YoY.

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Bollinger Bands show a moderate decline on the daily chart: the price range narrows, reflecting the emergence of ambiguous trading dynamics in the short term. MACD falls, keeping a poor sell signal below the signal line. Stochastic falls close to its lows, indicating that instrument may become oversold in the ultra-short term.

Resistance levels: 1877.83, 1900, 1930, 1952.53 | Support levels: 1850.2, 1823.09, 1800, 1760.74

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#6 - May 10, 2022, 09:45:07 AM

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The precious metal quotes show a local downward trend, trading around 21.5.

The key factor that led to the global sell-off in commodity markets was the US Federal Reserve's inflation forecast for April, which suggests a decline to 8.1% from 8.5% a month earlier. The main US statistics on the dynamics of consumer prices will be published today at 14:30 (GMT+2). Adjusting the interest rate to 1.00% could not have had such an early effect, and there are no prerequisites for reducing real inflation now: oil quotes are held above 100 dollars per barrel, contributing to fuel price growth, which increases the cost of delivering goods and increases their final cost. Thus, the key factors of inflation, such as fuel and food prices, are rising, but the regulator insists that inflation should come down. Uncertainty in the market forces traders to get rid of their assets in the stock market and commodity market.

A serious outflow of investors from silver is also confirmed by data from the US Commodity Futures Trading Commission (CFTC), according to which, over the past week, the number of net speculative positions decreased to 28.1K from 35.4K a week earlier. Over the past three weeks, the number of positions has decreased from 46.5K to the current 28.1K for the first time since 2020.

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The price left the limits of the rising global channel with dynamic boundaries at 26.50?22.00, breaking the support line yesterday. Technical indicators reversed and gave a sell signal: the range of EMA fluctuations on the Alligator indicator actively expands downwards, and the histogram of the AO oscillator forms downward bars in the sell zone.

Resistance levels: 22.15, 24.4 | Support levels: 21.17, 19.5
#7 - May 11, 2022, 12:07:11 PM

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On the daily chart, the fifth wave of the higher level (5) of 3 develops, within which the wave 3 of (5) formed. Now, a downward correction is ending as the fourth wave 4 of (5), within which the development of the wave c of 4 is ending.

If the assumption is correct, after the end of the correction, the pair XAUUSD will grow to the levels of 2070.42 - 2200. In this scenario, critical stop loss level is 1770.2.

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#8 - May 13, 2022, 08:00:37 AM

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Quotes of XAU/USD are under pressure from "hawkish" rhetoric from the US Federal Reserve and high prospects for the continuation of an aggressive monetary policy at the June meeting, in particular, a sharp increase in the rate by another 0.50%. The "bearish" momentum is expected to push gold prices towards psychological support at 1800. In addition, investors have become more inclined towards risky assets, redirecting their capital from protective ones, which also puts pressure on quotes, while the fundamental picture changes slightly.

Pressure on the position of gold is also exerted by the rising dollar, which is supported by technical factors and high yields on US Treasury bonds. However, the deteriorating economic outlook and the ongoing conflict in Eastern Europe are giving the precious metal some support. At the first sign that central banks will ease their "hawkish" rhetoric, one can expect a noticeable increase in demand for a "defensive" asset.

Among the macroeconomic factors at the beginning of the week, weak Chinese statistics should be singled out, providing additional support to the US currency. Retail Sales in China plunged to a record 11.1% in April after declining 3.5% in March. Analysts had expected a much more modest 6.0% decline.

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Bollinger Bands in D1 chart demonstrate a stable decrease. The price range is expanding from below; however, it fails to catch the surge of the "bearish" sentiment at the moment. MACD is going down preserving a stable sell signal (located below the signal line). Stochastic has been in close proximity to its lows for several days already, which indicates the risks of gold being oversold in the ultra-short term.

Existing short positions should be kept until technical indicators are clarified.

Resistance levels: 1823.09, 1850.2, 1877.83, 1900 | Support levels: 1800, 1775, 1752.87, 1730

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#9 - May 16, 2022, 07:20:09 AM

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On the daily chart, the fifth wave of the higher level (5) of 3 develops, within which the wave 3 of (5) formed. Now, a downward correction has developed as the fourth wave 4 of (5), within which the wave c of 4 has formed.

If the assumption is correct, the pair will grow to the levels of 2070 - 2200. In this scenario, critical stop loss level is 1785.69.

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#10 - May 20, 2022, 06:38:46 AM

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On the daily chart, a downward correction of the higher level develops as the second wave (2), within which the wave C of (2) forms. Now, the fourth wave of the lower level iv of C has formed, and the development of the fifth wave v of C has started, within which a local correction of the lower level is forming as the wave (iv) of v.

If the assumption is correct, after the end of the correction, the price will fall to the levels of 18.40?15.60. In this scenario, critical stop loss level is 23.20.

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#11 - May 23, 2022, 10:06:33 AM

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Gold prices show a slight increase during the morning session, developing a fairly strong "bullish" momentum formed in the middle of last week and trading at 1855.9. The main driver of the instrument's recovery was the weakening USD Index, which sharply corrected from multi-year highs around 105, losing more than 2.5%, to a low of 102, despite the "hawkish" rhetoric of the US Fed members.

Demand for XAU/USD is holding up as global tensions escalate as fundamentals change little. Many economies are facing record inflation amid soaring prices for energy and other resources, forcing investors to look for safer alternatives to risky assets. In turn, rising inflation prompts the world's central banks to sharply tighten monetary policy, making gold ownership less attractive, since it does not generate interest income. Meanwhile, a special military operation in Ukraine continues, and the negotiation process is actually stopped, so the conflict is becoming more and more protracted.

Today, investors are waiting for the publication in the US of May statistics on business activity, as well as April data on the dynamics of New Home Sales. During the day, the Chair of the US Federal Reserve, Jerome Powell, is also scheduled to speak.

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Bollinger Bands in D1 chart demonstrate active decrease. The price range is narrowing, reflecting the emergence of ambiguous dynamics of trading in the short term. MACD indicator is growing, while preserving a rather stable buy signal (located above the signal line). Stochastic approached the level of "100" and reversed into a horizontal plane, indicating a strongly overbought instrument in the ultra-short term and signaling in favor of the development of a corrective decline.

Resistance levels: 1877.83, 1900, 1930, 1952.53 | Support levels: 1850.2, 1823.09, 1800, 1775

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#12 - May 24, 2022, 08:33:17 AM

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On the daily chart, a downward correction of the higher level develops as the second wave (2), within which the wave C of (2) forms. Now, the fourth wave of the lower level iv of C has formed, and the fifth wave v of C is developing, within which a local correction of the lower level is ending to form as the wave (iv) of v.

If the assumption is correct, after the end of the correction, the price will fall to the levels of 18.4 ?15.6. In this scenario, critical stop loss level is 23.2.

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#13 - May 31, 2022, 08:30:34 AM

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Silver prices show a slight decrease during trading in Asia, developing a corrective momentum formed at the beginning of the current trading week. XAGUSD is testing 21.45 for a breakdown. Risk-driven market sentiment continues to shift to equities as yields rise on US government bonds, which investors currently prefer as alternative sources of additional funds, putting pressure on safe-haven assets such as silver. Since the dynamics of asset quotes of the metal group is inversely proportional to the movement of the US currency, XAGUSD is actively losing value.

Optimistic macroeconomic statistics from the USA provided moderate support to USD on Tuesday. The S&P/Case-Shiller Home Price Indices accelerated from 20.3% to 21.2% in March, ahead of market forecasts of a decline to 20%, and the Chicago PMI strengthened from 56.4 to 60.3 points in May, while the market expected a slight decline to 55 points. At the same time, Dallas Fed Manufacturing Business Index fell from 1.1 to -7.3 points in May, contrary to the forecast of growth to 4.9 points.

Silver, in turn, reacts positively to the long-awaited reopening of manufacturing facilities in Shanghai from June 1. Only 67 new cases of COVID-19 infection were detected in the country's largest financial center last Sunday, according to the Ministry of Health of the People's Republic of China. The authorities also eased some quarantine restrictions in Beijing. In general, the pace of industrial production in China is recovering, which increases the demand for silver as an industrial raw material.

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Bollinger Bands in D1 chart show moderate growth. The price range is narrowing, reflecting ambiguous dynamics of trading in the short term. MACD is declining, forming a new sell signal (trying to consolidate below the signal line). Stochastic keeps a steady downward direction but is rapidly approaching its lows, which indicates the risks of oversold silver in the ultra-short term.

Resistance levels: 21.69, 22, 22.40, 22.7 | Support levels: 21.39, 21.12, 20.81, 20.39

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#14 - June 01, 2022, 09:36:02 AM

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The XAUUSD pair holds above the key level of the previous 1800 and are currently being corrected after a slight increase.

Despite significant fluctuations in world markets, precious metals remain one of the most reliable investments. If traders preferred contracts for gold a year ago, today, buyers are showing particular interest in bullion and coins. According to the US Mint, sales of the most popular American Golden Eagle series in May of this year significantly exceeded previous periods: 200.5K coins or 147K ounces of gold equivalent were sold, significantly higher than 122.5K or 88K ounces sold in April. Also, if we consider the dynamics of sales in May 2021 with a figure of only 20.5K ounces, then the positive trend becomes more and more obvious.

According to the latest report from the US Commodity Futures Trading Commission (CFTC), over the past week, the global downtrend for the precious metal has been reversed, and after six weeks of constant decline, an increase in the number of gold contracts was recorded to 183.8K from 175.4K, which is quite expected, given the sharp outflow of short swap dealers, which was reported a week earlier.

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On the daily chart, the price is moving within the global ascending channel, forming a reversal near the global support line. Technical indicators maintain a weakening sell signal: fast EMAs on the Alligator indicator are approaching the signal line, and the AO oscillator histogram forms upward bars in the sell zone.

Resistance levels: 1866, 1917 | Support levels: 1810, 1770
#15 - June 02, 2022, 12:08:55 PM

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