In the aftermath of the latest NFP, the US dollar has declined across the board while gold’s recent strong gains have continued to end the week close to its all-time high of about $2,185. Signs that the labour market could be slowing down seem to confirm expectations that the Fed will cut its funds rate in June.
On the chart, the price of gold has made extremely strong gains in March so far and is now clearly overbought. The main challenge for potential new buyers here is estimating the timing and depth of the next consolidation or retracement. December 2023’s high around $2,140 seems like an obvious short-term support, while below there round numbers might be more important. There’s also the 0% weekly Fibonacci retracement, the area of last April’s high. The most important situation to avoid for short-term traders is being trapped in a losing position on a big corrective day like 4 December.
To the upside, $2,200 is an obvious short-term target which aligns with the 61.8% Fibonacci extension from last quarter’s upward movement. The equivalent 100% Fibo is around $2,320, but surely the price needs to consolidate or correct before reaching there. Tuesday’s American inflation could offer an entry to buy since the headline figure has consistently been higher than the consensus for a number of months. If that happens again, the price might decline temporarily.
The opinions here are my own; they do not reflect those of Exness. This is not a recommendation to trade.
On the chart, the price of gold has made extremely strong gains in March so far and is now clearly overbought. The main challenge for potential new buyers here is estimating the timing and depth of the next consolidation or retracement. December 2023’s high around $2,140 seems like an obvious short-term support, while below there round numbers might be more important. There’s also the 0% weekly Fibonacci retracement, the area of last April’s high. The most important situation to avoid for short-term traders is being trapped in a losing position on a big corrective day like 4 December.
To the upside, $2,200 is an obvious short-term target which aligns with the 61.8% Fibonacci extension from last quarter’s upward movement. The equivalent 100% Fibo is around $2,320, but surely the price needs to consolidate or correct before reaching there. Tuesday’s American inflation could offer an entry to buy since the headline figure has consistently been higher than the consensus for a number of months. If that happens again, the price might decline temporarily.
The opinions here are my own; they do not reflect those of Exness. This is not a recommendation to trade.