Gold struggles for direction after advance pauses

Gold has experienced significant gains since early March mainly due to the turmoil observed in the global banking sector. Even though bullion posted a fresh one-year high of 2,010 in the previous week, it quickly retraced lower and has been moving sideways for the last few daily sessions.

The short-term oscillators currently suggest that bullish near-term forces are subsiding but remain in control. Specifically, the MACD histogram is softening but holds above zero and its red signal line, while the RSI is ticking downwards above its 50-neutral mark.

If the positive momentum fades and the price moves to the downside, the February resistance region of 1,959 could act as immediate support. Diving lower, the price could descend to challenge the recent low of 1,933. Should that barricade fail also, the 1,885 hurdle, which overlaps with the 50-day simple moving average (SMA), might provide downside protection.

Alternatively, should gold resume its short-term advance, the bulls could initially aim at the crucial 2,000 psychological mark. A violation of that region may open the door for the one-year high of 2,010. Failing to stop there, further advances could then cease at the March 2022 high of 2,070 registered after Russia’s invasion of Ukraine.

Overall, gold seems to be stuck in a rangebound pattern after its recent rally came to a halt. Hence, a break above the 2,010 ceiling is needed to revive bulls’ hopes for the continuation of gold’s uptrend.

About the author

Stefanos Oikonomidis

Stefanos bergabung XM sebagai Analis Junior pada September 2021. Ia melakukan riset pasar harian pada mata uang, komoditas dan pasar ekuitas, dari perspektif fundamental dan teknis. Sebelum bergabung di XM, ia memperoleh wawasan berharga dengan bekerja sebagai Pekerja Magang Risiko Kredit di bank besar Yunani.

Stefanos meraih gelar Master di bidang Finansial dari Warwick Business School dan gelar Sarjana di bidang Akuntansi dan Finansial dari Athens University of Economics and Business. Ia percaya bahwa untuk menjadi sukses di industri, Anda harus bisa mengidentifikasi kekuatan pendorong di balik setiap pergerakan pasar, dan dibahas secara jelas dengan para pembaca.