The Chart of the Week: Gold correcting towards critical resistance from fresh bear cycle lows

Gold bulls stepping in at a daily demand area.
$1,735/45 to be tested in the correction in a 50% mean reversion of hourly bearish impulse.

Ross J Burland FXStreet

As per the prior analysis, Gold Price Analysis: Bears about to burst out of their cage to target $1,745.80, we did see repeated failures at critical support and the price subsequently plummeted.

Prior analysis, daily chart

Live market, daily

Meanwhile, the bears are testing the bullish commitments at an old area of resistance:

This area would be expected to hold initial attempts to break below.

This gives rise to the prospects of a significant correction of the recent bearish impulse.

A healthy Fibonacci retracement to the region between a 38.2% Fino and the 50% mean reversion level has a confluence with the prior lows of $1,760.72.

With that being said, from an hourly perspective, there are prospects of a downside continuation to test deeper into the liquidity of the daily support and demand territory should a test of $1,735/45 prove are a strong wall of resistance.

Hourly chart

Premium

You have reached your limit of 3 free articles for this month.

Start your subscription and get access to all our original articles.

Subscribe to Premium Sign In

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

GBP/USD loses momentum, flirts with 1.3200

GBP/USD is struggling to maintain its positive bias on Thursday, retreating toward the 1.3200 region in response to the pick in the buying interest around the Greenback. That said, Cable remains under scrutiny as cautious market sentiment keeps investors focused on the US-Iran conflict and political effervescence in the UK.

EUR/USD trims gains, challenges 1.1400

EUR/USD now gives away part of its earlier advance, receding toward the 1.1400 contention zone on Thursday. Meanwhile, the pair’s recovery comes amid extra losses in the US Dollar, at the time when while investors continue to monitor developments in the Middle East and sentiment surrounding global technology stocks.

Gold remains bid and close to $4,100

Gold accelerates its recovery and approaches the key $4,000 mark per troy ounce at the end of the week, adding to Thursday’s advance. However, expectations for a hawkish Fed remain steady and keep the yellow metal’s potential upside contained.

Crypto Today: Bitcoin at $60,000, Ethereum at $1,500, and XRP at $1 face a make-or-break test

Bitcoin (BTC), Ethereum (ETH), and Ripple (XRP) are trading in the red on Friday after three consecutive days of losses, testing their respective make-or-break support levels.

Week ahead – NFP report to challenge Dollar strength and the hawkish Fed

Dollar strength dominates markets, as the hawkish Fed overshadows geopolitics and lower oil prices. NFP week could drive September Fed hike expectations and boost market volatility. The euro lacks fresh bullish catalysts, all eyes on the preliminary inflation report and the ECB Forum.

Regime change: Inside Kevin Warsh's first move to make the Fed unreadable on purpose

The rate did not move. That was the least interesting thing about Kevin Warsh's first meeting in charge of the Fed. The FOMC held its benchmark at 3.50%-3.75% for the fourth straight meeting, exactly as priced, and then the new chair used his first press conference to dismantle the machinery the market has leaned on for a decade.