Trading | 2 months ago
Gold prices are trading sideways from last five trading sessions. Currently gold is trading close to the one-week low and below the important psychological resistance level of $1800, exhibiting no sign of recovery. The bullish and bearish momentum in gold is equally weak as there is no substantial swing in the gold price.
Fed’s policy outlook confusion and strengthening dollar continues to suppress the interest of investors in gold. More pressure from the bears may break down the support level at $1,741 and from there gold prices may go down to the next support level of $1,680. As seen on the monthly chart, Gold is headed for the biggest monthly drop in more than four years after the federal reserve's rate hike projection.
The recent price correction in crypto currencies including Bitcoin and Ethereum which provided an opportunity to many new traders to enter and buy the crypto currencies at the dip have also weighed on the precious metal. The crypto currencies by their inherent nature are more volatile and liquid than the gold, provides quick and more return than any traditional commodities like gold or silver.
Looking from the technical perspective on the daily chart of gold, gold prices have started to form a bear flag continuation pattern. The 10-day moving average which represents the short-term average price has crossed below the 100-day moving average, indicating that technical outlook for gold is bearish. Therefore, one must look for short-term selling opportunities in gold at the current price near $1780.
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