Gold Technicals – Moving back above 1,400

Hourly Chart


After testing the 1,400 round number twice after the incredible slide, Gold has finally cleared the ceiling and accelerated higher towards the 38.2% Fib Retracement level after pushing above the previous swing high of 1,405. This also marks the continuation of bullish correction from 16th April back towards 1,500, back at where all it started. Prices have been producing higher highs and higher lows, which makes a good case for a uptrend, while Stochastic readings is showing a divergence with consecutive peaks heading lower yet price heading higher.

This divergence suggest that current peak could be a red herring and a bear cycle may not truly materialize despite the fact that the 38.2% Fib is proving to be a good resistance against current bullish momentum. We could potentially see price trading towards 1,400, while finding support along the rising trendline to re-test the 38.2% Fib if price is unable to push up higher right now. But that is in no way a sign that price will be able to reach the previous bearish glory of 1,322.

Fundamentally, nothing has really changed much, the whole selling wasn’t truly a fundamental push but due to an extra large sell order that spooked the market last Friday. Right now it seems that market believe fair value of Gold to be higher, but bulls were simply being cautious about buying too much as there wasn’t any evidence that the bear trend has ended. With a new uptrend coming up, we could potentially see more bulls gaining confidence to buy into the same gold which they sold in a puff earlier.

More Links:
USD/JPY Technicals – 99.0 reached, 100 eyed
NZD/USD Technicals – Long-term Breakout vs Short-term Recovery
USD/SGD Technicals – Sitting on 1.235

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Mingze Wu

Mingze Wu

Currency Analyst at Market Pulse
Based in Singapore, Mingze Wu focuses on trading strategies and technical and fundamental analysis of major currency pairs. He has extensive trading experience across different asset classes and is well-versed in global market fundamentals. In addition to contributing articles to MarketPulseFX, Mingze centers on forex and macro-economic trends impacting the Asia Pacific region.
Mingze Wu