Hello everyone, as we all know the market action discounts everything :)
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The gold market has suffered a lot in the last 4 days where the price dropped from the highs of $1866 and reached $1783 today, That is a 4.4 % drop in 4 days.
The market is trying to stabilize but so far to no avail.
From current levels, any subsequent fall below the $1,800 mark is likely to find decent support near the $1,791-89 confluence comprising of technically significant 100 and 200-day SMA. A convincing break below would suggest that gold has topped out in the near term and pave the way for a slide to the next relevant support near the $1,770-68 horizontal zone.
Possible Scenario for the market :
The market is trading at $1783.76 and has broken the support line at $1788.17 this might cause the market to drop even further at least until it hits the support located at $1771.29 where we might see a correction happen but so far there are no major signs yet.
In case the trend was able to break the $1771 support then we could be seeing the gold reaching the $1740.63 in the next period of time.
Technical Analysis show :
1) The market is below the 5 10 20 50 100 and 200 MA and EMA on the Daily chart (Strong Bearish Sign)
2) The RSI is at 40.67 showing weakness in the market with no divergence found between the market and the indicator.
3) The MACD is still above the 0 line indicating a Bullish major trend but having a negative crossover between the MACD line and the Signal line.
Support & Resistance points :
support Resistance
1) 1788.17 1) 1835.71
2) 1771.29 2) 1866.37
3) 1740.63 3) 1883.24
Fundamental point of view :
The recent US dollar rally got a strong boost on Monday after US President nominated Jerome Powell to serve as the Fed chairman for a second term. The fact that investors considered the other leading candidate, Lael Brainard, to be the more dovish of the two, the announcement reinforced bets for higher US interest rates. This, in turn, pushed the USD Index to a 16-month peak and prompted aggressive selling around the dollar-denominated gold.
Meanwhile, growing acceptance for an early policy tightening by the Fed triggered a fresh leg up in the US Treasury bond yields. In fact, the yield on the two-year US Treasury note, which is highly sensitive to interest rate expectations, shot to the highest level since March 2020. Adding to this, the yield on the benchmark 10-year US government bond surged past the 1.60% threshold. This further underpinned the greenback and acted as a headwind for the non-yielding yellow metal.
This is my personal opinion done with technical analysis of the market price and research online from Fundamental Analysts and News for The Fundamental point of view, not financial advice.
If you have any questions please ask and have a great day !!
Thank you for reading.
_________________________________Make sure to Like and Follow if you like the idea_________________________________
The gold market has suffered a lot in the last 4 days where the price dropped from the highs of $1866 and reached $1783 today, That is a 4.4 % drop in 4 days.
The market is trying to stabilize but so far to no avail.
From current levels, any subsequent fall below the $1,800 mark is likely to find decent support near the $1,791-89 confluence comprising of technically significant 100 and 200-day SMA. A convincing break below would suggest that gold has topped out in the near term and pave the way for a slide to the next relevant support near the $1,770-68 horizontal zone.
Possible Scenario for the market :
The market is trading at $1783.76 and has broken the support line at $1788.17 this might cause the market to drop even further at least until it hits the support located at $1771.29 where we might see a correction happen but so far there are no major signs yet.
In case the trend was able to break the $1771 support then we could be seeing the gold reaching the $1740.63 in the next period of time.
Technical Analysis show :
1) The market is below the 5 10 20 50 100 and 200 MA and EMA on the Daily chart (Strong Bearish Sign)
2) The RSI is at 40.67 showing weakness in the market with no divergence found between the market and the indicator.
3) The MACD is still above the 0 line indicating a Bullish major trend but having a negative crossover between the MACD line and the Signal line.
Support & Resistance points :
support Resistance
1) 1788.17 1) 1835.71
2) 1771.29 2) 1866.37
3) 1740.63 3) 1883.24
Fundamental point of view :
The recent US dollar rally got a strong boost on Monday after US President nominated Jerome Powell to serve as the Fed chairman for a second term. The fact that investors considered the other leading candidate, Lael Brainard, to be the more dovish of the two, the announcement reinforced bets for higher US interest rates. This, in turn, pushed the USD Index to a 16-month peak and prompted aggressive selling around the dollar-denominated gold.
Meanwhile, growing acceptance for an early policy tightening by the Fed triggered a fresh leg up in the US Treasury bond yields. In fact, the yield on the two-year US Treasury note, which is highly sensitive to interest rate expectations, shot to the highest level since March 2020. Adding to this, the yield on the benchmark 10-year US government bond surged past the 1.60% threshold. This further underpinned the greenback and acted as a headwind for the non-yielding yellow metal.
This is my personal opinion done with technical analysis of the market price and research online from Fundamental Analysts and News for The Fundamental point of view, not financial advice.
If you have any questions please ask and have a great day !!
Thank you for reading.