Before I get into the writing of this idea, I understand that I am likely gonna be in the minority and I understand also that a lot of people are going get highly upset because gold tends to have an emotional hold on many traders — which I find interesting. Nevertheless, here's what I see....
This analysis is being done mostly from a weekly chart. So, to understand what I'm gonna say, you'd need to select the weekly time frame.
Gold has reacted twice to a supply zone that was established in August of 2020, creating a triple-top formation. From that zone, price rallied from a demand zone that was created during the early part of that same year and creating an area of support around 1670. With that being said, from the weekly chart's perspective, gold has been in a trading range for the past 3 years.
Here's what I think will happen and why. I think that from here, gold could fall to 1300. On a smaller time frame, price has already shown a willingness to decline and if price takes out the 1670 support area, I don't see any viable demand area to stop price from reaching 1300. Everything that I see underneath support area simply areas of liquidity.
From a fundamental perspective, with interest rates rising and causing the dollar to rise along with rates, that's bearish for commodities — including gold. If gold is to rally, then I'd have to see buyers absorb the selling that is occurring at the present level.
This analysis is being done mostly from a weekly chart. So, to understand what I'm gonna say, you'd need to select the weekly time frame.
Gold has reacted twice to a supply zone that was established in August of 2020, creating a triple-top formation. From that zone, price rallied from a demand zone that was created during the early part of that same year and creating an area of support around 1670. With that being said, from the weekly chart's perspective, gold has been in a trading range for the past 3 years.
Here's what I think will happen and why. I think that from here, gold could fall to 1300. On a smaller time frame, price has already shown a willingness to decline and if price takes out the 1670 support area, I don't see any viable demand area to stop price from reaching 1300. Everything that I see underneath support area simply areas of liquidity.
From a fundamental perspective, with interest rates rising and causing the dollar to rise along with rates, that's bearish for commodities — including gold. If gold is to rally, then I'd have to see buyers absorb the selling that is occurring at the present level.