The price of gold last Friday moved up to test its 100/200-day moving average (blue and green lines on the chart below). Sellers leaned against those levels and the price on Monday/Tuesday tried to keep a lid at those moving averages.
However, on Wednesday, the price broke higher and it’s been trending to the upside since then. Today the high price has reached $1997.16 – just short of the natural resistance at $2000. That may provide a temporary top for gold, but it’s hard to be aggressive to the downside with the geopolitical risks from the Middle East (and US domestic risk from the inability of the House of Representatives to approve a speaker). Gold is a safe haven has been a story this week as a result.
On the downside, it would take a move below the 100-hour moving average currently at $1945 to take away from the bullish bias. That moving average is moving higher. So it is not out of the question given the right storyline. However, it would probably take some “favorable story” to see sellers wrestle back control. The price action will help tell the story and the move below the 100 hour moving average would be part of that story.
Gold pushes toward the $2000 level today