Gold Price Analysis: Don't get too excited there are still some key levels to break
- Gold is trading 0.70% higher at the start of the week despite performing poorly last week.
- There are three key levels above the current price the bulls need to watch.
Gold 4-hour chart
Gold has pushed higher on Monday as there has been a good retracement in the greenback at the start of the week. The price has been making lower lows and lower highs since hitting the all-time high back on 6th August. It could be an interesting September for gold especially leading into the US election.
Looking at the chart, the price seems to have found some support at USD 1850 per troy ounce. There are now some key levels of resistance where the price bounced in the past. The next resistance stands at USD 1882.60 per ounce and this level has been used twice and both support the price well. The level at USD 1915 per ounce is the stronger of the two. The price has reacted there eight times in a short space of time and it could once again. Lastly, the purple downward sloping trendline could be important as if the price breaks there we could see a retest of the highs.
The indicators are looking bullish at the moment the Relative Strength Index is making a bullish divergence pattern which means the waves have made a higher low, while the price wave made lower lows. The MACD has just crossed to the green side but the signal lines are still lagging under the mid-level.
All in all, on the higher timeframes the yellow metal is still in an uptrend. It remains to be seen if the trend will continue to create new all-time highs but if these key levels are taken out there is a good chance.
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Additional levels
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.
