Gold Technical Analysis | Forexlive

Since the last FOMC meeting the US economic data has
been consistently surprising to the upside and led to a more hawkish repricing
in interest rates expectations ultimately pressuring gold. The Fed members are
also talking about two more rate hikes this year if the data remains strong. As
long as we keep seeing strength in the data, we can expect lower lows in gold,
but if the data starts to miss expectations, we should see gold coming back
strongly.

Gold Technical Analysis –
Daily Timeframe

On the daily chart, we can see that gold has been
struggling to break the 61.8% Fibonacci retracement level to
the downside as the market is awaiting the next NFP and CPI reports. The trend
is clearly bearish as the moving averages are
crossed to the downside, the price is making lower lows and lower highs and the
key support levels like the trendline and the
1934 support got
broken. The target for the sellers is the 1805 swing low level and the buyers
will need first a break above the 1934 resistance to regain control and target
the 1984 level first and the 2076 high next.

Gold Technical Analysis – 4
hour Timeframe

On the 4 hour chart, we can see that the price
jumped above the 61.8% Fibonacci level and pulled back from the 38.2% Fibonacci
level of the entire downward move to retest the breakout, where we can also
find the red 21 moving average acting as dynamic support. The buyers may step
in here with a defined risk below the 1909 support and target the trendline and
the 1934 resistance, where we will likely find sellers waiting to position for
another leg lower.

Gold Technical Analysis – 1
hour Timeframe

On the 1 hour chart, we can see that gold
is bouncing from a trendline where we have a good confluence of the
1909 support level, the 4-hour red 21 moving average and the 61.8% Fibonacci
retracement level. We should expect buyers piling in here targeting the 1934
resistance. The sellers, on the other hand, may want to wait for the price
reaching the 1934 resistance to position for more downside or wait for the
price to break below the trendline to start piling in and ride the next bearish
wave.

Upcoming Events

This week we
have some really important events like the ISM Manufacturing PMI today, the US
Jobless Claims and ISM Services PMI on Thursday and finally the main event of
the week: the US NFP on Friday. Strong data should lead to a more hawkish
interest rates pricing and weigh on gold, while weak data should support gold
and push it to the upside.