FUNDAMENTAL
OVERVIEW
The bullish momentum in
gold waned recently despite lots of tailwinds like lower real yields, looser
financial conditions and lower US dollar. It’s certainly not been the same
since the late January crash, and the major difference is that the Fed has
pivoted away from the dovish stance.
Nonetheless, gold should
remain supported amid the positive US-Iran deal expectations which should keep any
downside limited.
Everything now hinges on
US-Iran talks. If negotiations were to collapse again, we might get a bigger pullback,
but as long as the ceasefire holds, the losses should remain limited. On the
other hand, a peace deal might give gold another boost to extend the rally into
new highs. For a much stronger rally, gold would need the Fed to pivot back to a
dovish stance.
GOLD TECHNICAL
ANALYSIS – DAILY TIMEFRAME
Gold – daily
On the daily chart, we can
see that gold is continuing to slowly edging higher as the bullish momentum
waned. The natural target for the buyers is the downward trendline around the
5,000 level. If the price gets there, we can expect the sellers to step in with
a defined risk above the trendline to position for a drop into the major upward
trendline. The buyers, on the other hand, will look for a break to increase the
bullish bets into the 5,400 level next.
GOLD TECHNICAL ANALYSIS – 4
HOUR TIMEFRAME
Gold – 4 hour
On the 4 hour chart, we
have a trendline defining the bullish momentum. The buyers will likely lean on
the trendline with a defined risk below it to keep pushing into the major downward
trendline. The sellers, on the other hand, will look for a break to pile in for
a drop into the major upward trendline around the 4,100 level.
GOLD TECHNICAL ANALYSIS – 1
HOUR TIMEFRAME
Gold – 1 hour
On the 1 hour chart, we
have a minor downward trendline defining the current pullback into the upward
trendline. The sellers will likely continue to lean on the trendline to keep
pushing into new lows, while the buyers will look for a break to pile in for a
rally into new highs. The red lines define the average daily range for today.
