Gold Price Analysis: This chart pattern suggests a break is imminent

Gold has moved 0.50% lower on the session as the global risk appetite flip flops.
There is a wedge pattern on the 4-hour chart and the price is moving toward the end of the pattern.

Rajan Dhall, MSTA FX Daily

Fundamental backdrop

It has been a tale of two halves today as in the EU session stock markets sold off but as the US traders entered the fray, markets turned slightly higher. The major resistance in gold has been USD 1708.70 on Monday as it seems consolidation is the way for now.

There was one bit of interesting news in an otherwise dull day. US treasury sec Mnuchin stated that there is a need to step back before a new stimulus round. Not the usual bullish attitude that we have come to expect from the Americans. He also seems to think that the employment figures will get better as the US heads to the summer.

This week there are some more notable data releases to look forward to including CPI from the US, GDP from UK and Germany. Another highlight will be any comments from Fed Chair Jerome Powell on Wednesday. The question of negative rates could be asked as the futures markets have now started to price them in for January 2020.

Technical picture

The 4-hour chart pattern below shows that the consolidation may be reaching its end quite soon. The higher lows and lower highs look to be converging and if previous chart patterns are anything to go by there could be an interesting move in either direction. On the daily chart, the triangle and wedge patterns have yielded good rewards and on the last two occasions, the price moved up over USD 80. If the price does move lower then the USD 1640.00 and USD 1575.00 areas could provide some support are they seem to be pretty strong levels with Fibonacci confluence.

Additional levels

XAU/USD

Overview
Today last price	1702.73
Today Daily Change	0.00
Today Daily Change %	0.00
Today daily open	1702.73

Trends
Daily SMA20	1707.34
Daily SMA50	1644.41
Daily SMA100	1604.22
Daily SMA200	1547.95

Levels
Previous Daily High	1723.7
Previous Daily Low	1701.48
Previous Weekly High	1723.7
Previous Weekly Low	1682.3
Previous Monthly High	1747.82
Previous Monthly Low	1568.46
Daily Fibonacci 38.2%	1709.97
Daily Fibonacci 61.8%	1715.21
Daily Pivot Point S1	1694.91
Daily Pivot Point S2	1687.08
Daily Pivot Point S3	1672.69
Daily Pivot Point R1	1717.13
Daily Pivot Point R2	1731.52
Daily Pivot Point R3	1739.35

Author

Rajan Dhall, MSTA

FX Daily

Rajan Dhall is an experienced market analyst, who has been trading professionally since 2007 managing various funds producing exceptional returns.

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