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Gold Technical Analysis | Forexlive

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Gold has been rallying almost non-stop in the past
couple of weeks as the bullish drivers started to accumulate. The US data
lately has been showing signs of weakness, especially on the labour market
side, and this led to the market pricing in more rate cuts for next year. More
recently, some hawkish Fed members shifted their tone to a more dovish stance
with Waller being
the main example as his comments increased the amount of rate cuts priced for
next year. All of the above, contributed to the fall in real yields and the US
Dollar which is bullish for Gold.

Gold Technical
Analysis – Daily Timeframe

Gold Daily

On the daily chart, we can see that Gold extended
the rally to new highs reaching the 2050 level and now being very close to the
all-time high at 2076. The recent rally got a bit overstretched as depicted by
the price distance from the blue 8 moving average. In such
instances, we can generally see a pullback into the moving average or some
consolidation before the next move.

Gold Technical Analysis – 4
hour Timeframe

Gold 4 hour

On the 4 hour chart, we can see that from a risk
management perspective, the buyers should wait for a pullback into the trendline where
they will have a better risk to reward setup and the confluence with the
red 21 moving average and the 38.2% Fibonacci retracement level.
The sellers, on the other hand, will want to see the price breaking lower to
position for a drop into the swing low at 1950.

Gold Technical Analysis – 1
hour Timeframe

Gold 1 hour

On the 1 hour chart, we can see more
closely the current price action with the market consolidating a bit after the
strong push to the upside in the last two days. This is still a buyers’ market,
so the sellers should wait for a break below the trendline before considering
short positions. The buyers, on the other hand, should wait for the pullback
into the trendline or a break above the counter-trendline before entering new
long positions.

Upcoming Events

Today we will get the US PCE and US Jobless Claims
data with the market likely focusing more on the Jobless Claims figures given
that we already saw the latest inflation data with the US CPI report just two
weeks ago. Tomorrow, we conclude the week with the US ISM Manufacturing PMI
which missed expectations by a big margin the last time. Weak data should give
a further boost to Gold while strong figures will likely lead to a pullback.

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