Monthly TF Perspective Of Yellow Metal. Door Open to Test 1550!

FX_IDC:XAUUSD   Gold Spot / U.S. Dollar
This is a monthly TF analysis of the yellow metal. The main chart shows numerous horizontal lines, these are concrete support and resistance levels taken from monthly charts. This year many people predicted the yellow metal to break out of its long term held range and it happened! After 1370 level was broken, the next hurdle was present at 1430 which held against a very bullish pressure from the yellow metal. So in short 1430 is not a new resistance just formed! it has been held on numerous occasions and broken too.

Therefore from a technical perspective GOLD is still indeed bullish however just to be safe, it is advisable for the monthly candle to close above 1430.00 before going LONG to target 1550 where the next resistance is present

Any trade deal between US and China if agreed it could take the yellow metal down where another long term held ascending trendline is present. Until this trendline is not broken we are still bullish on gold! Another thing to consider is that at the moment the price is confined in a triangle practically preventing the price from further climbing. Should a strong bullish candle close above 1430 this would not only confirm resistance break but also the triangle/trendline break too.

Fundamentally, the factors are in favour of yellow metal appreciation! First of all the tradewar is having effects on the economy and many central banks have started to cut rates with the FED thinking of cutting rates too and turning dovish in a surprising manner in the last couple of FOMC meeting. Fear of recession are also alive and well as the US yield curve has inverted again. In this classic scenario the safe haven currencies such as CHF and JPY appreciate but so does GOLD

Therefore it remains to be seen what develops in the coming months but a test of 1550 level is very much on the cards!
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