Gold Bearish Pressure mounting near $1570 Support while breaking below the mid-term Trend line. Gold may continue the downward pressure along the way. Let’s check Gold Technical Analysis for more levels and insights.
February 4, 2020 | AtoZMarkets.com – Gold is currently pushing lower after certain correction and volatility along the way. Gold Bullish run slowed down trying to reach $1600 in the process. The price recently broke below the mid-term Trend line which indicates further downward pressure in the making. The Bearish trend in Gold have not attracted any attention but certain downward pressure has already established in the market.
Asian stock rebound is currently rumored as the setback for Gold currently. Chinese equities recently pushed higher more than 1% which attracted back the investors to jump back in. Though the Chinese economy is still struggling to make a mark, not much of investors are showing interest to risk. As per certain reports, Chinese Central Bank flooded the economy with liquid cash to support the economy. As per sources, The People’s Bank of China injected 400 Billion Yuan into Banking system. Moreover, U.S. Stock also closed higher pushing the Gold bit lower along the way.
As Oil has been struggling to push back higher, Gold was considered as safe-haven investment by the investors. But as per current scenario, investors are diversifying among equities despite the current global crisis due to Coronavirus.
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Gold to Retrace lower towards $1550 again?
Gold has been quite consistent and stable with the recent Bullish move which pushed the price higher towards $1592. The price has been quite impressive and non-volatile with the upward pressure until the Bearish Engulf after retesting $1592 area.
image: Gold 4 hour chart
Gold is currently pushing lower after breaking below the mid-term trend line support. According to 4 hour chart, The Price did form certain Bearish Divergence along the MACD lines residing above 0.00 level. Though the price is forming Bearish pressure in Gold along the way, but it is still being held by the Kumo Cloud support.
Gold Bearish Pressure may sustain longer
The dynamic levels like 20 EMA, Tenkan and Kijun line is working as resistance along the way which confluences the Bearish pressure. But still the Bearish trend sustainability is a question until the price breaks below the 4 hour Kumo Cloud Support.
Currently, price can push lower $1550 but it may struggle until a strong Bearish pressure breaks below $1560. As there is not much of Bullish Divergence emerging, Gold Bearish pressure may continue pushing lower in the process.
To conclude, Gold may reach $1550 area again but need to break below the Kumo Cloud support at $1560. The Bullish Bias is still strong but may struggle to maintain the momentum as per current price momentum.