The Gold dropped sharply today, has hit a very strong dynamic support, which has stopped the bearish momentum. The buyers have stepped in again in the last 2 hours and have forced the price to increase and to erase today’s losses. The price has increased in the last hours as the US dollar has lost significant ground versus its rivals.
The dollar has fallen as the USDX has plunged aggressively and now is very close to delete the today’s gains, a further drop will force the greenback to depreciate further. The Gold could take advantage of a weaker dollar and could start another bullish momentum.
The gold could increase as the Aussie has managed to appreciate versus the greenback, the AUD/USD has managed to reach new highs, has jumped above the 0.7694. The AUD received support today also from the Australian economic data, the figures have come in better compared to the previous reading period. The Westpac Consumer Sentiment rose by 2.3% in February, more versus the 0.1% growth in January, while the New Motor Vechicle Sales rose by 0.6%, beating the 0.1% growth in the previous reading period.
The rate has touched the 150% Fibonacci line, which represents a strong dynamic support, this line has rejected the price, you can see that is trading much above this level. The minor retreat was somehow expected after the last bullish momentum, could still approach the 50% Fibonacci line (descending dotted line), the short term perspective remains bullish after the breakout above the median line (ML) of the descending pitchfork and above the 50% retracement level. Could find strong resistance somewhere at the lower median line (lml) of the former descending pitchfork and at the 38.2% Fibonacci line, but the next major upside target will be at the upper median line (UML) of the major descending pitchfork, remains to see how will react when will touch the mentioned resistance levels.
Will be very important to see what will happen on the USDX in the coming period, has rebounded in the last days, but remains to see if the short term retreat is completed.