Gold Bears Weakens as the price is approaching lower towards $1625 support area. Bears gained momentum as the price of Gold broke below $1650 area. Let’s check Gold Technical Analysis for more levels and insights.
March 12, 2020 | AtoZ Markets – Gold failed to continue the Bullish trend and broke below $1650 area. Gold turned quite corrective and volatile recently leading to certain counter. The price is now holding by the Kumo Cloud, which may help Bulls to gain momentum in the coming days.
Gold failed to stay on the safe-haven path after it’s decline in the Asian market session today. Gold was unable to maintain the Bullish momentum as like other markets and commodities. The losses in the U.S. equities market overnight and in the Asian market today resulted in Gold fall for a second day.
Moreover, The United States President, Donald Trump announced that all flight from the U.S. to Europe would cancel for 30 days, and it will start from Friday on the fears of Coronavirus outbreak. The world is walking on the path of recession because of COVID-19, which can amount to the same impact as the Financial Crisis in 2008 and the Great Depression in 1929.
Gold Bears Weakens but Bulls Survives
The price is now trading at $1630 area, but Gold Bears weakens currently as the price approaches the floor. The price of Gold is currently very corrective and indecisive after an extended period of Bullish trend.
Image: Gold 4 hour chart
According to the 4-hour chart, Gold is currently residing near $1630 area and trying to recover higher. Gold price declined impulsively after the price rejected $1700 area. The price facing support at $1630 area and may lead to certain weakness of the Bearish pressure. Moreover, the price is now residing inside the Kumo Cloud, which may hold the price as a strong support.
On the other hand, the Gold may recover higher at least towards the dynamic level of 20 EMA, which may pull the price higher as Mean Reversion. The Kijun line and the Tenkan line may work as a confluence of the dynamic level of 20 EMA. Besides, the Stochastic Oscillator lines emerging a Bullish cross over below 20 level, which is an indication of upcoming Bullish Pressure.
Gold Bullish Trend may Sustain with Dynamic Confluence
According to the Daily chart, the price of Gold is currently trading at $1630 area and holding by the dynamic levels as Gold Bears weakens. After rejecting from the $1700 area, the Bears push down the price quite impulsively. Though the Bulls maintained the price above $1625 area with a daily close, but the Bears are still quite active to pressurise the upward momentum. Alternatively, if the Gold continues to decline and breaks below the dynamic levels and $1625 area support area with a daily close, it may push lower towards $1560 area.
Image: Gold Daily Chart
Moreover, the dynamic level of 20 EMA is holding the price as support, along with the Kijun line and the Tenkan line. As per the current scenario, Gold may bounce higher from the dynamic levels, if the price manages to remain above $1620. On the other hand, the MACD indicator lines are showing Bearish cross over and the histogram volumes forming Bearish Divergence. As a result, the price is currently quite indecisive until a daily close above or below $1620 is observed.
To conclude, Gold is currently quite Indecisive and Volatile. Though the overall bias is still Bullish, the Bears may take over the market if the price breaks below $1625 support area.