Gold flirts with upper boundary of trading range
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Gold stands above descending line.
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20- and 50-day SMA post bullish cross.
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MACD and RSI show positive signs.
Gold prices rose above the short-term descending trend line, but the upper boundary of the trading range of 2,580-2,720 looks to be a real struggle for the bulls.
Technically, the 20- and 50-day simple moving averages (SMAs) created a bullish crossover, and the momentum oscillators are also confirming a bullish wave in the market. While the MACD is moving north above its trigger and zero lines, the RSI tilts to the upside above the neutral threshold of 50.
At the 2,720 barricade, the market is indicating a potential downside move towards the 2,655 support. Below that, the long-term uptrend line at 2,625 and the lower band of the sideways channel at 2,580 may halt bearish movement.
On the other hand, a successful rally above 2,720 could pave the way for further increases up to the 2,750 resistance level, which is ahead of the all-time high of 2,790. Marginally above this line, the 261.8% Fibonacci extension level of the down leg from March–October 2022 of 2,070–1,616 at 2,800 may give the green light for another strong battle.
All in all, the yellow metal is neutral in the short-term view, and only a break above or below the consolidation area may clear the next direction in the market.
Author
Melina joined XM in December 2017 as an Investment Analyst in the Research department. She can clearly communicate market action, particularly technical and chart pattern setups.
