Gold finds resistance around the 200-day SMA within upward sloping channel

Gold have developing slightly higher over the last five weeks, holding within an upwardly sloping channel.

The price opened with a positive gap earlier in the day, remaining marginally below the 200-day simple moving average (SMA), while the RSI and the MACD provide little direction about the next move in the price as the former is heading up below its 50 neutral mark and the latter remains stable within the negative territory.

If buyers break through the 1,857 barrier and the 50-day SMA, the next challenge could come from the area between the 1,878 barrier and the top of the short-term bullish channel. Notably, the upper limit of the medium-term bearish channel is in the same area. So, any move up from there could be important for getting close to the 1,915 barrier. Even higher, the ascent may stop between the 2,000 round number.

On the other hand, if the price closes below $1,810, it may stay stable around the uptrend line ahead of the 1,805 support. Moving lower, the market may reach the 1,785 level, causing a sharper drop towards 1,752-1,762.

Overall, gold is still neutral in the short term, and traders are waiting for a long-term move above 1,890 or below 1,805 to give the market a new direction.

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).