Technical Analysis – Gold bullish momentum fades; price further away from last week’s 5-½-month high

Posted on April 24, 2017 at 7:20 am GMT by the XM Investment Research Desk

Gold is down from the day’s open with the price further distancing itself from the five-and-a-half-month high hit last week. The short-term indicators are projecting a weakening positive momentum.

In particular, the RSI indicator is bullish at 56 but has recorded a steep fall to reach the level it’s currently at. Looking at MACD, the histogram is on the one hand positive, but it has fallen below the red signal line.

The area around the 1280 handle has been a congested one recently and could serve as a barrier to the upside. A move above, would shift the focus to the April 17 five-and-a-half-month high of 1295.38, a potentially important resistance mark. Further up, the 1300 level could act as a psychological barrier to even stronger bullish action.

On the downside, the current level of the 200-day moving average (MA) at 1254.70 might offer support. This coincides with a congested area in the recent past. Below this, the 50-day MA at 1245.03 could provide additional support.

Regarding the medium-term picture, the neutral outlook remains in place with prices remaining in consolidating mode over the last number of months.

Overall, the short-term bias is still bullish but seems to be losing steam, and the medium-term is neutral.

Source: www.xm.com