The price of gold moved slightly higher today after analysts at ICBC predicted that its price would reach $1,300 by December this year. Will the pair reverse the trend? What does the 6 August XAUUSD Price Technical Analysis show?
6 August, OctaFX – Analysts at ICBC believe the price will average $1260 an ounce in the third quarter, and more in the final quarter. The price will move up as the Fed provides guidance for the coming year.
They expect the Fed to guide on few interest rates hikes, which will drag the dollar down. They also expect the demand for physical gold to rise and supply to be subdued.
In South Africa, big miners have recently announced more than 16,000 job cuts as the cost of mines become unprofitable. This is likely to lead to depressed supplies, which will provide support to the price of gold.
6 August XAUUSD Price Technical Analysis
The XAUUSD pair established a top at the $1365 level in April this year. Since then, the price of gold has continued to fall, reaching a low of $1204, last week.
The current’s bullion price is the lowest since July last year. On the daily chart below, the price is below the 200, 100, and 50-day EMA. In the past few weeks, the price has remained at the oversold level of 30. The same is true with the Commodity Channel Index (CCI), which is currently at negative 139.
There is a likelihood that the XAUUSD pair will reverse the trend at these levels. However, a drop below the $1200 level could signal potential downsides.
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