- Gold is trading 0.50% lower as the dollar moves higher again on Thursday.
- The price found some support at a key technical zone.
Gold 4-hour chart
The US dollar and gold are in an important crossroads at the moment where the current trend is unclear. Longer-term gold has been in an incredible uptrend and since hitting a higher of USD 2,075.14 per troy once the price has pulled back 6.97%. This does not necessarily mean the trend is over but this is a pretty strong correction and could be a buying opportunity for the bulls.
Looking at the chart, the price has now bounced off the USD 1,925 per ounce support area. This price point is where the internal downward sloping trendline and short term trendline meet and cross over. The consolidation low is at USD 1,863.24 per ounce and if this level breaks to the downside then a more pronounced sell-off could be in store.
The Indicators are showing a mixed picture. The Relative Strength Index is bouncing off the oversold level. This is interesting as the market made a higher low and the indicator has made a lower low wave. This is called a bullish failure swing and it’s a bullish sign. The MACD is more bearish as the histogram is red and the signal lines have just breached the zero level.
A key zone to watch is the USD 2,000 per ounce resistance zone. If the price breaks that zone above the red resistance then the all-time high could be tested again. On the downside, the aforementioned consolidation low at USD 1,863.24 is an important support and if it breaks the gold bulls could be in for some pain.