Gold charts a second higher peak in the series
XAUUSD has charted a higher trough (HT) followed by a higher peak (HP). This is the classical definition of an uptrend. In fact, a second higher trough (HT) followed by a second higher peak (HP) has been charted, effective today. This series is a sign of underlying strength.
The precious metal is near the 200-day SMA, which may act as resistance. However, if it can overcome this level and the SMA turns up this will be regarded as bullish. The RSI(9) is above 50, which is indicative of an underlying bullish momentum and the longer it stays above 50 the greater the likelihood of the 200-day SMA being exceeded.
To a great extent the trajectory of the precious metal will be determined by the forward guidance of the Fed. If the Fed is dovish going into 2019 this is likely to weigh heavily on the USD. Given that gold and the USD are generally regarded as having an inverse relationship, this scenario (should it take place) may indeed provide a boost for the precious metal.
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