Gold drops below $1230

Matías Salord FXStreet

A stronger US dollar across the board pushed the price of the yellow metal to the downside. The value of the ounce is pulling back on Monday after a having a sharp rally on Friday, from 2-week lows.

XAU/USD reached $1236 at the beginning of the week but then lost strength and started to decline. Recently it broke below the short-term support area around $1230 and fell to $1228 hitting a fresh daily low.

Levels to watch

Now the metal is looking at the next support at $1225. Below there attention would turn to Friday’s low at $1222 and then to the $1220 zone. A consolidation below $1220 could open the doors for a test of $1205 - $1200.

To the upside, now $1230 is the immediate resistance. XAU/DUSD needs to rise above the 20-day moving average that stands at $1238 in order to remove the short-term bearish pressure.

Since the beginning of March, gold lost more than $20, amid a recovery of the US dollar supported by expectations of several rate hikes from the Federal Reserve during 2017. For the current year, is still in positive territory, up 7%

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

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