Could the shiny Gold metal remain in favour of the bulls?
XAUUSD, Daily
Gold Futures rallied sharply following the uber-dovish FOMC outcome on Wednesday, seeing prices rally from under $1,300 to 3-week highs of $1,320.20 in London morning trade. Gold’s advance came as the Fed called off further rate hikes this year, resulting in a sharply lower Dollar, and lower Treasury yields, both Gold positives.
Since then, a modest Dollar recovery has seen Gold pull back to $1,314, with slight pressure coming earlier after the Philly Fed index snapped back and jobless claims dipped.
After the break yesterday of the long term pivot point at $1,310, Gold’s outlook has changed to a more positive one. Technically, yesterday’s spike which has been followed by another movement higher today, imply a price action above 20- and 50-Day SMA but also the return of more than 50% of February’s losses at $1,313.
This level is a key one as if breached on a closing basis it would open the upside back towards 10-month highs, at $1,325-$1,340.
A notable acceleration in daily momentum indicators has been already identified, with RSI crossing above 50, whilst MACD lines have been eliminated in the negative area. If these bullish signals are confirmed the bullish sentiment is expected to rise further.
A failure to sustain gains above $1,314 today could lead to the retest of $1,310 (Daily Pivot point), and the clash of 20- and 50-DSMA at $1,305. Further decline could open the way towards latest lows at $1,285-$1,280.
Author
Having completed her five-year-long studies in the UK, Andria Pichidi has been awarded a BSc in Mathematics and Physics from the University of Bath and a MSc degree in Mathematics, while she holds a postgraduate diploma (PGdip) in
