Gold: Bulls need to breach $1937 to be looking at a renewed rally scenario [Video]

Gold

As with several of the major markets we look at consistently, we are seeing conflicting signals on gold which is generating a consolidation for now. What looked to be conviction buying in the rebound from $1863 was scuppered by a big selling day on Wednesday last week. Since then the gold price has formed a series of small bodied candles that seem to be gravitating around the 23.6% Fibonacci retracement of the big $1451/$2072 rally at $1926. The near term pullback downtrend line comes in around $1973 today. This would need to be breached for the bull to be looking at a renewed rally scenario. Initial resistance is at $1961 from yesterday’s bull failure. There is still a sense that this is still a moderating pullback to the big 11 week uptrend (which supports at $1901 today). The daily momentum indicators have been unwinding but are also now stabilising in decent areas to suggest this has been a good phase to renew upside potential for the renewal of the medium to longer term trend higher. It could though be a consolidation that continues for a few days yet though, with a crucial speech by Fed chair Jerome Powell on Thursday likely to drive the next key move. Support at $1906/$1911 will become ever more important as this week rolls on and the uptrend rises.