Gold prices continue to be under pressure as the Dollar strengthens. The yellow metal started the week testing resistance at the $1100 level, but it headed south as the US currency rallied curbing the demand for metals as an alternative investment. Gold is currently being supported around $1075, but it’s hard to say that these supports could hold any longer if a new wave of selling pressure were to hit the market. Gold traders will be closely watching the US GDP numbers and its effect on the Dollar as it seems clear that currencies are driving the price action of the metal. On a broader picture, recent cautious moves from China instructing banks to curb lending can be perceived as bearish for the Gold market. The opinion of billionaire investor George Soros about gold being “the ultimate bubble” is shared by many investors, suggesting that market’s sentiment could be anticipating further declines.
GOLD DAILY CHART
Bullish Scenario– Support around the 1075 level holds the bearish wave and sends Gold north in a new bullish cycle.
Target A– 1100
Target B– 1125
Bearish scenario– A break below the 1170-1175 area fuels the bearish sentiment further to test the 1050 level and potentially lower.
Target A- 1050
Target B– 1025
Daily Forex Market Analysis provided by eToro
Disclaimer: Trading in the Foreign Exchange market might carry potential rewards, but also potential risks. You must be aware of the risks and are willing to accept them in order to trade in the foreign exchange market. Don’t trade with money you can’t afford to lose.
