Unlocking Gold’s Potential: Examining Its Next Moves in the Market

Good morning Traders!

These 3 charts could help traders plan their next moves around Gold.

Let’s start with the Monthly for context:

Gold’s recent moves almost straight up from $1,600 are the most aggressive since a similar attempt was made in March 2021 (seen to the left). Also, it has travelled a lot further.

It now sits at a major price level which could be the most resistance it has faced in a while.

Now let’s take a look at the Weekly chart.

Here we can see that it is also over-extended by some way on this timeframe.

It’s only Thursday, but there is also a small red weekly candle printing at a major resistance level.

In many cases this would lead to the beginning of a swing high forming, should price break below this red candle in the following week, potentially seeing Gold drop to a lower level.

The big question is, which level?

There are several levels that qualify as valid price targets, but ultimately it will depend on how bullish Gold is leading into the future, which no-one can predict.

In the weekly chart, a retracement in this weekly uptrend down to $1,800 makes the most sense: It’s a major level, and a 61.8% retracement from the highs.

Let’s look at the daily chart for more detail.

It gets tricky here; there is NO divergence yet on either of the momentum indicators below, hinting that although it is over-extended and at a major level, it is not ready to stop. There’s even a green/bullish candle printing today.

Often in situations like this there is another attempt to move higher, which then leads to a stronger rejection and a subsequent sell-off.

Two areas of interest that price could ultimately retrace down to here are the highlighted boxes, but we will need to see how price action reacts when it gets there.

Thankfully, once Gold has had a healthy pullback, it could then provide fresh buying opportunities.

Happy Trading!

Adam Harris

FXGlobe Ambassador Adam Harris is based in London, UK. He’s been trading professionally since 2013 and his specialties are technical and trend-based trading.

Trading Advice Disclaimer:
Our Ambassador’s Daily Picks are not trading advice. These are informational articles covering the events which happened in the market already & scheduled events which are scheduled to happen in the Economic & Earnings Calendar.

General Risk Warning:
Trading leveraged products such as Forex and CFDs carries a high level of risk thus may not be appropriate and/or suitable for all investors. The investment value can both increase and/or decrease and the investors may lose all their invested capital. The content of this website does not constitute financial or investment advice. Any information herein is of a general nature and does not take into consideration your personal circumstances, investment experience or current financial situation. Under no circumstances shall the Company or affiliated Companies have any liability to any person or entity for any loss or damage in whole or part caused by, resulting from, or relating to any transactions related to leveraged products.

Maximize Your Earnings with FXGlobe!

Unlock the potential of your savings with the Reliance Savings Account, offering competitive rates on EUR, USD, and AED. Enjoy high returns and the security of a trusted financial institution.

Why Choose Our Savings Account?

Interested in growing your savings?

Click the button to learn more and sign up today!