Gold (XAU/USD) Analysis, Price and Chart
Gold is continuing to press higher and is now around $100/oz. higher than the recent double-low print made in early/late March. This double-low was just below the 61.8% Fibonacci retracement level at $1,689/oz. and the 50% Fibonacci retracement level around the $1,764/oz is now acting as a new level of support. If this continues to hold, the precious metal is likely to attempt to break back above $1,800/oz. before it eyes the 38.2% Fib level at $1,837/oz.
For all market-moving events and data releases, see the DailyFXCalendar[2]
The fluctuations in the US dollar[3] have been one of the main drivers in gold’s price action lately and this is expected to continue. The 10-year US Treasury yield is currently in the middle of a 1.50%-1.75% range and while this remains the case then gold is expected to trade in a sideways pattern. Strong US economic data continues to point to higher US inflation – a gold negative – although the central bank continues to see any rise in price pressure as transitory. The Fed remains focussed on the US jobs market as their main area of concern and while the unemployment rate fell to 6.0% in March, it is still 2.5 percentage points higher than its pre-pandemic level in February 2020.
One signal on the daily gold chart suggests shirt-term bullish potential with the 20-day simple moving average moving above the medium-term 50-day sma. This cross-over confirms the positive sentiment in the market and may help to extend gold’s recent rally. The CCI indicator shows gold in overbought territory and this reading may have to move into neutral territory before the
