Gold technical analysis: Discovers foothold and glues to 200-MA
|Gold has located its footing in the support zone of 1,844-1,852 after steadily fading from the 1,900 vicinity, breaking a tentative uptrend line - pulled from the 1,678 trough - and piercing below the 200-period simple moving average (SMA). The declining slope of the 50-period SMA has somewhat eased and together with the 100-perod SMA, are suggesting the price may adopt a sideways trajectory, at least for a while until a more absolute direction evolves.
The flattening blue Kijun-sen line is signalling that negative momentum has lost its power, while the short-term oscillators are indicating that buyers are striving to gain the upper hand. The MACD, some distance below zero, has prodded marginally above its red trigger line, while the RSI is struggling to improve towards its neutral threshold. Should the recently gained bullish charge in the stochastic oscillator endure, this could promote extra positive traction in the price.
If the vital border of 1,844-1,852 proves to be a strong foundation and the price returns above the 200-period SMA at 1,860, early resistance could arise from the 1,870 nearby high. Hiking further, gold may then encounter a resistance zone between the 50- and 100-period SMAs at 1,881 and 1,890 respectively. Next, the crucial 1,900-1,904 boundary may impede additional gains in the commodity. However, if buying interest dominates, the focus may then turn to the 1,910-1,917 neigh bouring ceiling, the latter level being the 5-month peak.
To the downside, immediate support may come from the 1,844-1,852 zone. Should this significant border break down, the price could sink towards the next corresponding troughs of 1,820 and 1,809. Despite continual downside pressures, the price would need to fall beneath the 1,800 handle to confirm that price sentiment has become increasingly negative.
Summarizing, gold seems to have moulded a strong footing around the 1,844-1,852 proximity. The commodity may adopt a sideways demean our should this foundation remain steadfast.
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