Gold maintains weak bias in near term; broader trend is bullish [Video]
|Gold prices have been underperforming in the past month, hovering around the 20- and 40-day simple moving averages (SMAs) and slightly above the Ichimoku cloud. When looking at the bigger picture the price has a clear upside tendency despite the latest sideways movement after the pullback on the all-time high of 2,074.89.
In the daily timeframe, momentum is too weak to provide a sustained move higher. The RSI is moving horizontally marginally above the 50 level, while the MACD is standing beneath its trigger line, trying to slip below the zero level.
If price action remains above the 23.6% Fibonacci retracement level of the up leg from 1,454 to 2,074.89, there is scope to test again the 1,972 strong resistance. Clearing this key level would see additional gains towards the 2,015 barrier. Rising above it would see a retest of the record peak of 2,074.89 and then further above, there would be a resumption of the uptrend.
If 1,927 support fails, then the focus would shift to the downside towards the 1,900 psychological level. A breach of this level would increase downside pressure and bring about a reversal of the trend, hitting 1,860 and the 38.2% Fibonacci of 1,836.
Overall, the yellow metal has been neutral in the near term, while in the long-term view, price action remains bullish.
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