Gold is consolidating around a key support zone. what next
Gold has been stuck in a consolidation lately as the market awaits the US CPI release scheduled for today. In the big picture, gold should be supported as we get closer to a rate cut cycle. Moreover, even if the CPI data is hot, the figures should look much better in the second quarter as the higher readings of the first quarter of 2023 are excluded from the calculation.
The hard part is to combine the short-term direction with the long-term direction and for that we can take the help of technical analysis.
Daily chart
We can see that gold has recently rallied around a key support area around the 2020 level, where we can find a trend line intersection and the 61.8% Fibonacci retracement level.
This is where the buyers have piled up around the trend line with a certain risk to turn into a rally to a new high. On the other hand, sellers want to see the price lower to invalidate the bullish setup and position for a drop to the 1970 level.
4 hour chart
We see that we have a downtrend line that defines the current short-term downtrend. Sellers are likely to rely on the risk-defined trend line around it to break below the main uptrend line.
On the other hand, buyers want to see the price move higher to invalidate the bearish setup and push bullish bets to all-time highs.
1 hour chart
We can see recent price action more closely with gold trading between 2020 support and 2040 resistance. Not much to do here except wait for the levels and key settings to work. Keep an eye on the data today as we are likely to see big moves later.
Attention:
* Be sure to keep an eye on the DXY dollar index chart.
* Monitor the news carefully.
* Use the combination of technical and fundamental analysis in the stock market, stock exchange, forex and digital currencies.
Gold has been stuck in a consolidation lately as the market awaits the US CPI release scheduled for today. In the big picture, gold should be supported as we get closer to a rate cut cycle. Moreover, even if the CPI data is hot, the figures should look much better in the second quarter as the higher readings of the first quarter of 2023 are excluded from the calculation.
The hard part is to combine the short-term direction with the long-term direction and for that we can take the help of technical analysis.
Daily chart
We can see that gold has recently rallied around a key support area around the 2020 level, where we can find a trend line intersection and the 61.8% Fibonacci retracement level.
This is where the buyers have piled up around the trend line with a certain risk to turn into a rally to a new high. On the other hand, sellers want to see the price lower to invalidate the bullish setup and position for a drop to the 1970 level.
4 hour chart
We see that we have a downtrend line that defines the current short-term downtrend. Sellers are likely to rely on the risk-defined trend line around it to break below the main uptrend line.
On the other hand, buyers want to see the price move higher to invalidate the bearish setup and push bullish bets to all-time highs.
1 hour chart
We can see recent price action more closely with gold trading between 2020 support and 2040 resistance. Not much to do here except wait for the levels and key settings to work. Keep an eye on the data today as we are likely to see big moves later.
Attention:
* Be sure to keep an eye on the DXY dollar index chart.
* Monitor the news carefully.
* Use the combination of technical and fundamental analysis in the stock market, stock exchange, forex and digital currencies.