The Price of Gold Pulls Back Towards $1,490 After Topping $1,510

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The price of gold (XAU/USD) on Thursday pulled back to trade at around $1,493 after rallying to top the $1,510 level in the morning hours. Gold prices have been on a resurgence in recent trading sessions as they attempt to recover from the late plunge experienced towards the end of last month.

Since the start of this month, the price of the yellow metal has rallied from a low of about $1,460  to top the $1,518 level before pulling back towards the $1,490 support zone.

Gold Price Fundamentals Overview

From a fundamental perspective, the price of the yellow metal is trading at the back of another mixed week in terms of global economic data. The US 10-Year note auction-rate edged lower to 1.590% down from 1.739% in the previous period.

German Industrial Production for August beat expectations of -0.3% with 0.3% on a month-over-month basis while Italian retail sales for the same month missed expectations on both (YoY) and (MoM) basis.

On the other hand, uncertainty over Brexit continues to weigh on the global financial markets which again boosts the position of the yellow metal as a safe haven. 

More US rate cuts are increasingly becoming a potential before the end of the years and this could boost the price of gold further while the US-China trade tensions ease after Trump indicated the possibility of a concessionary decision on Huawei. 

Gold Price Technical Analysis (the 60-min Chart)

Technically, the price of gold appears to be trading in an ascending wedge, which indicates a short-term bullish bias in the market sentiment. The latest pullback has pushed the gold price towards the edge of the trendline support, which could trigger the next rebound.

Therefore, the bulls will be targeting short-term profits at around 50%, 61.80% and 76.40% Fib levels at $1,497, $1,506 and $1,518, respectively. On the other hand, the bears will be looking to pounce at around 38.20% and 23.60% Fib levels at $1,488 and $1,477.

Gold Price Technical Analysis (the Daily Chart)

In the daily chart, the price of gold appears to have recently made a bearish reversal after a long period of upward movement. The yellow metal now trades in a descending channel and has recently bounced off the trendline resistance.

Therefore, the bears will be targeting long-term profits at around$1,472 or lower at $1,453. On the other hand, the bulls will be hoping for a quick turnaround by targeting profits at around $1,518 or higher at $1,539.

In summary, the price of gold appears to be trading under extreme long-term bearish pressure but in the short-term, the bulls ap[pear to have seized control.

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