Gold bulls look exhausted near 200-day SMA

Gold prices have been battling with the 200-day simple moving average (SMA) over the last week, posting some spikes towards the 1,810 resistance level. Any movements beyond these obstacles could add to the optimism for more aggressive bullish actions.

However, the technical oscillators are suggesting some losses in the near future. The MACD fell below its trigger line in the positive territory, while the RSI is sloping downwards above the neutral threshold of 50.

Should weakness extend below the 200-day SMA line, support to downside movements could initially be detected from the 20-day SMA at 1,766 ahead of the 1,730 barrier. Clearing that zone, the next stop could be near the 50-day SMA at 1,720 before the bears hit the 1.675 line.

Alternatively, the pair needs to overcome the 1,810 resistance top to meet a key barrier of 1,880. The 2,000 psychological mark could act as resistance too before a more important battle starts near the 20-month high of 2,070, switching the outlook to strongly bullish.

In the medium-term picture, the sentiment will turn bullish if the price surpasses the 200-day SMA and the 1,810 barrier.

About the author

Melina Deltas

Melina joined XM in December 2017 as an Investment Analyst in the Research department. She can clearly communicate market action, particularly technical and chart pattern setups. Her technically focused method looks mainly at price action across multiple time frames to capture big moves that develop over the years. She has more than 3 years of experience in analyzing financial markets, specializing in forex, indices, and commodities. Melina studied Pure Mathematics at Lancaster University and has a Master's Degree in Monetary and Financial Economics from the University of Cyprus. Currently, she is an associate member of the Society of Technical Analysts (STA) and a Certified Financial Technician (CFTe).