Gold sinks to $1237; set for pullback

FXOpen

Gold yesterday closed with a huge bearish engulfing candle on daily chart which clearly shows that bulls are losing grounds after Fed tapering decision. The precious metal slumped $30 per ounce on Thursday to $1237, however then retreated somewhat to close at $1243.

At the moment of writing in Asian session yellow metal is being traded at $1243. Resistance can be noted around $1248, $1253 and then $1255 these are 100 MA (H4) 55 MA (H4) and 76% fib levels respectively.

Gold sinks to $1237; set for pullback

On downside, gold may find support at $1233 which is 200 MA at four-hour chart and 55 DMA ahead of $1230 that is a crucial 50% fib level of recent move. A break and daily close below $1230 will be very bearish in medium term and may threaten $1219. At the moment Commodity Channel Index (CCI) is already in oversold territory and Relative Strength Index (RSI) is standing just above the oversold zone on four-hour chart. MACD has also started showing some signs of improvement, all these factors point out that a bullish reversal might be in play very soon. Furthermore, the metal is about to complete its downward wave because swing low of previous wave is sitting around $1231.

 Today some important economic reports about the US economy are due in the US session:

  • Employment Cost Index (Q4)
  • Personal Income (MoM) for December
  • Consumer Consumption Reports for December (YoY) & (MoM)
  • Personal Spending (Dec)
  • Chicago Purchasing Managers Index (Jan)
  • Reuters Michigan Consumer Sentiment Index (Jan)

Earlier a commerce department report showed yesterday that the US economy grew at 3.2% last year which was in accordance with median projection by different analysts. The report also revealed an increase in personal consumption expenditures by 1.1% which was the highest level in more than three years, figures show that economy has started gearing up.

Trade over 50 forex markets 24 hours a day with FXOpen. Take advantage of low commissions, deep liquidity, and spreads from 0.0 pips. Open your FXOpen account now or learn more about trading forex with FXOpen.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Stay ahead of the market!

Subscribe now to our mailing list and receive the latest market news and insights delivered directly to your inbox.

forex

Forex Trading with FXOpen

Forex Trading with FXOpen

Experience ECN technology for deep liquidity and light-speed trade execution

  • Access over 50 markets
  • Trade with spreads from 0.0 pips
  • Take advantage of commissions from $1.50/lot
Learn more

Latest articles

An Important Bullish Pattern Forms on the NIO Share Price Chart
Shares

An Important Bullish Pattern Forms on the NIO Share Price Chart

Today, the share price of NIO Inc. (NIO), a Chinese manufacturer of "smart" electric vehicles, is trading above $4 – a development that may be viewed as an optimistic scenario following the drop to $3 in the first half of April,

S&P 500 Chart Analysis Ahead of the Busiest Week of Earnings Season
Indices

S&P 500 Chart Analysis Ahead of the Busiest Week of Earnings Season

Despite the fact that President Trump’s earlier decision to impose tariffs (at higher rates than expected) shook the stock markets, the S&P 500 index (US SPX 500 mini on FXOpen) could still end April without significant losses

USD/CAD Consolidates
Forex Analysis

USD/CAD Consolidates

In the second half of April, the USD/CAD chart has shown a decline in volatility following significant spikes observed since February.

The Canadian dollar has stabilised against the US dollar within the 1.390–1.380 range over the

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 60% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.