Gold unable to convince on the upside, turning south towards breakout support-line
- Gold has turned south from the descending resistance at 1306 and priced through the 1300 level to a low of 1298.34 so far, looking for a break below with sights set on 1280.
- Price action likely limited until the Fed this week, but plenty of risk events on the cards to move markets.
Gold prices have been recovering from the 1280 lows but has so far been unable convince o the upside with momentum dwindle as drivers, such as Brexit, trade talks, (the NZ shootings made for a knee-jerk reaction), take the foot off the gas as markets now prefer to see the outcomes of such noise.
Eyes on the Fed
Meanwhile, all eyes are on the Fed this week in precious metals, where traders are looking for lower dots, and a bigger balance sheet. "While gold prices have remained bound in a tight range of late, the bar remains elevated for the Fed to ignite fireworks that would significantly impact prices," analysts at TD Securities argued. "Meanwhile, CTAs continue to eye a break above the $1315/oz range before they significantly add to upside flow in gold."
Gold levels
While trading above 1275, on the way up, bulls can target 1315 as the next key target that meets the trend-line prior support of the rising channel - 1313 is the 50% Fibo target. 1332 guards the 2019 highs as being the 19th Feb high of 1345.19. While 1280 is a keen target, 1275 remains the line in the sand to the downside, and a break below it will put the attention back to the towards to 1250, a key confluence area made up of Fibos and prior support and resistance.
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.
