Gold has been pretty resilient this week as it
erased most of the losses from the prior week. The lack of important economic
data most likely played a role as well as the market didn’t have anything to
push it further to the downside. In fact, in the big picture, Gold should
remain supported as we head into the easing cycle, but in the short term, the
price action is driven by the repricing of rate cuts.
Gold Technical Analysis –
Daily Timeframe
Gold Daily
On the daily chart, we can see that Gold erased
almost all of the losses from the prior week. From a risk management
perspective though, the buyers will have a much better risk to reward setup
around the 2142 level where we can also find the confluence of the
38.2% Fibonacci retracement level
and the red 21 moving average. The
sellers, on the other hand, will want to see the price breaking below the 2142
level to position for a drop into the trendline around
the 2080 support.
Gold Technical Analysis – 4
hour Timeframe
Gold 4 hour
On the 4 hour chart, we can see that the latest leg
higher diverged with the
MACD, which
is generally a sign of weakening momentum often followed by pullbacks or
reversals. In this case, the target for the pullback should be the support zone
around the 2142 level. A break below that zone should confirm the reversal and
trigger a selloff into the major trendline. For now, the price is supported by
the minor upward trendline where the buyers continue to lean onto to position
for new higher highs. The sellers will want to see the price breaking below the
trendline to position for a drop into the support targeting a break below it
with a better risk to reward setup.
Gold Technical Analysis – 1
hour Timeframe
Gold 1 hour
On the 1 hour chart, we can see that we had
an important level at 2200 which has been a strong resistance for the recent
bullish wave. The breakout triggered a rally as the buyers piled in to target a
retest of the all-time. If the price pulls back into the resistance
now turned support, we can expect the buyers to step in again. The sellers,
on the other hand, will likely lean on the all-time to position for a drop into
the 2142 support.
Upcoming Events
Today we get the latest US Jobless Claims figures,
while tomorrow we conclude with the US PCE report and Fed Chair Powell. Strong
data is likely to weigh on Gold, while weak figures should give it a boost.
