Technical Analysis – Gold bullish bias; price close to multi-month high recorded two days ago
Posted on April 19, 2017 at 7:02 am GMT by the XM Investment Research Desk
Gold has edged lower from the day’s open, falling to a point where it more or less offsets yesterday’s rise in price. The precious metal posted a more than five-month high two days ago (Monday).
The alignment that has been in place since March 27 when the Tenkan-sen line (red) crossed above the Kijun-sen (blue) hints to a bullish short-term sentiment. Additionally, notice that the Tenkan-sen is positively sloped, perhaps indicating that there’s still momentum for upside movements in price. The MACD histogram reinforces these signals as it is currently positive and above the red signal line.
If the price moves higher, Monday’s high of 1295.38 could offer some resistance. A move above this point, would shift the focus to the November 2 six-and-a-half-month high of 1307.83 (excluding the high from Trump’s election victory of 1337.12), while 1300 might serve as a psychological barrier to the upside as well.
On the downside, the current level of the Tenkan-sen at 1271.19 could serve as immediate support. If it fails to hold, the 200-day moving average (MA) at 1255.69 might offer additional support. Below this, a support area could be formed by the current level of the Kijun-sen and the 50-day MA, at 1246.24 and 1242.47 respectively.
Regarding the medium-term outlook, it currently looks neutral given the significant consolidation in prices over the last number of months.
Overall, the short-term bias is bullish and the medium-term is neutral.