The US
real yields keep on rising non-stop and given the inverse correlation with
Gold, we saw the precious metal falling non-stop as well. The economic data
continues to show a resilient economy even after the second most aggressive
tightening in history and this makes the market wonder if the Fed might need to
do more. Overall, there are more bearish drivers for Gold than bullish ones at
the moment, and we should keep seeing the downtrend continue unless the data
starts to point towards a recession.
Gold Technical Analysis –
Daily Timeframe
Gold Daily
On the daily chart, we can see that Gold has
reached the 1893 low. This is where we can expect the buyers to step in with a
defined risk below the level to target a bounce into the 1934 resistance. If the
price breaks lower though, the sellers should pile in even more aggressively
and target the 1805 swing low level.
Gold Technical Analysis – 4
hour Timeframe
Gold 4 hour
On the 4 hour chart, we can see that the price has
been diverging with the
MACD for
quite a while now. This is generally a sign of weakening momentum often
followed by pullbacks or reversals. In this case, if we see a bounce, the
pullback should end at the trendline where we
can expect the sellers piling in to target a break below the 1893 low. If the
price breaks higher though, it will confirm the reversal and the buyers should
extend the rally into the 1934 resistance.
Gold Technical
Analysis – 1 hour Timeframe
Gold 1 hour
On the 1 hour chart, we can see more
closely the setup with the trendline and the Fibonacci
retracement levels for confluence.
That’s the resistance area to watch as we either get a rejection or a breakout.
Upcoming Events
The only big event left for this week is
the US Jobless Claims report
today. Given that we are at a key support it looks like a clear setup. If we
get a big beat, Gold is likely to break lower and fall. On the other hand, if
we get a big miss, Gold should rally as treasury yields should fall after such
a big rally.