Gold Price Technical Analysis
- Gold prices[1] gapped-higher to start this week.
- Fear has driven the Gold bid so far in 2020.
- FOMC[2] rate decision takes place tomorrow at 2PM ET.
Gold Prices Hold Resistance
Gold prices gapped-higher to start this week’s trade, moving along with the general theme of risk aversion that’s continued to show in global markets. The recent driver is the threat of Coronavirus spreading, with US equities starting to show a bit of fear last Friday and that continued through Monday trade. That Friday run of fear also brought another bullish breakout to Gold with price action pushing above the 1567 level[3] of resistance.
But, at this point, S&P futures appear to have garnered some support around a bullish trendline projection and that fear bid may be ready to take a break if not a back-seat altogether. In Gold, prices have built in a quiet range after this week’s opening gap. And while that gap hasn’t yet been filled, there has been a bit of support coming from last week’s resistance, and a bit of scope provided by a Fibonacci retracement produced from the November-January bullish move. The 23.6% retracement helped to produce last week’s highs and currently shows as potential support. And the 14.4% retracement is helping to set this week’s high around the 1587 level.
Gold Price Two-Hour Chart
Chart prepared by James Stanley[4]; Gold on Tradingview[5]
Gold’s Longer-Term Trend and the Challenge of Short-Term Observations
Current short-term price action quickly moved into overbought levels at the beginning of this year, and RSI even went overbought following last week’s breakout. This extreme bullish drive is likely emanating through an alignment of themes; with expectations around the FOMC to
