XAU/USD could reach $2,000 as early as this year


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2 years ago

Gold - The bulls have lost control of the rally. The uptrend has been decisively broken by a second strong negative candlestick and as such we turn neutral on a near term basis. Although our medium term outlook on gold remains positive, the near term bullish arguments have been crossed off one by one. It is though important to remember that just because an uptrend has been broken, it does not necessarily mean a big corrective move is imminent. Momentum indicators have swung lower (RSI below 60 and a near term cross lower on Stochastics), however, MACD lines are merely slipping back within their positive configuration. Dropping through support at $1562/$1572 has opened a retreat to the 38.2% Fibonacci retracement (of $1445/$1611) at $1546 which is a good basis of support now. We remain positive on gold on a medium term basis whilst the support band $1536/$1546 remains intact and weakness is a chance to buy. So with gold rebounding this morning, there is clearly an appetite to support gold still. The hourly chart shows a decisive move back above 50 would be a positive signal again. Initial resistance now $1562/$1570.

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