The golden metal in its 8-hour chart illustrates a bearish process that remains intact. Follow with us our reasoning for a potential bearish continuation in Gold.

1. The latest rally developed by the US Dollar index, suggests the short-term weakness in the yellow metal.

2. The stock market's rally shows the risk-on preference by big traders. In consequence, the safe-heaven commodity should under-performs for a short time.

3. From the wave analysis perspective, price action makes us expect a decline in five waves as a wave C labeled in black. This downward movement could accelerate on coming sessions. While price continues moving under $1,472.9, the bias will continue bearish.

4. A sell-side position will activate if the price closes under $1,459.5 per ounce. Our conservative profit target is at $1,450.5; a bearish extension could drive to the golden metal to continue its declines to $1,442.25, even until $1,432.3 per ounce.

5. Our bearish scenario will be invalid if price soars and closes above $1,472.9.

6. The risk of the bearish scenario will come from the end of the bullish cycle on the stock market, or if the US Dollar index continues developing mostly bearish.

 

Trading Plan Summary

Entry Level: $1,459.5

Protective Stop: $1,472.9

1st Profit Target: $1,450.5

2nd Profit Target: $1,442.25

3rd Profit Target: $1,432.3

XAUUSD

 


 

Try Secure Leveraged Trading with EagleFX!

Risk Warning: CFD and Spot Forex trading both come with a high degree of risk. You must be prepared to sustain a total loss of any funds deposited with us, as well as any additional losses, charges, or other costs we incur in recovering any payment from you. Given the possibility of losing more than your entire investment, speculation in certain investments should only be conducted with risk capital funds that if lost will not significantly affect your personal or institution’s financial well-being. Before deciding to trade the products offered by us, you should carefully consider your objectives, financial situation, needs and level of experience. You should also be aware of all the risks associated with trading on margin.

Analysis feed

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!


Latest Forex Analysis

Editors’ Picks

EUR/USD recaptures 1.10 as dollar suffers a fresh sell-off

EUR/USD is trading above 1.10, recapturing the level as the dollar retreats. After a three-day rally, stocks are cooling but the safe-haven dollar is still under pressure. Coronavirus headlines are eyed. 

EUR/USD News

GBP/USD extends rally above 1.23 amid USD weakness

GBP/USD is trading above 1.23, some 900 pips off the lows amid dollar weakness. UK coronavirus cases are rising at a growing pace and Brexit talks have been put on ice. 

GBP/USD News

Cryptocurrencies: Bulls honing their antlers for an upward attempt ahead

The sense of extreme fear is divergent with the levels of the mathematical averages. Bitcoin dominance ratio moves at a structural pivot level and can lead to a trend change. XRP is the winner of the day, but far away from fleeing out of the bearish scenario.

Read more

Gold trades with modest losses below $1620 level, downside seems limited

Gold edged lower through the early European session and is currently placed near the lower end of its daily trading range, just below $1620 level. Concerns over an imminent global recession might help limit losses.

Gold News

US Jobless Claims Analysis: 3 M is only the beginning, 3 reasons why USD may rise

Unemployment is engulfing the US – weekly jobless claims jumped to 3.283 million, an increase of 1,053%. The four-week moving average is near one million, also surpassing the worst since the Great Financial Crisis.

Read more

Forex Majors

Cryptocurrencies

Signatures