Gold price correction at $1560 may create Bearish Pressure leading the price towards $1535 again. The price having strong Bullish trend in place may struggle to continue higher. Let’s check Gold Technical Analysis for more levels and insights.
January 23, 2020 | AtoZMarkets.com – Gold has been quite volatile and corrective after rejecting off the $1568 area. The price did manage to sustain a Bullish trend with a rising channel which recently broke and retested. Gold may bounce back but it might require certain Bearish pressure along the way.
Gold momentum has been affected by Coronavirus in China. Investors currently expect that Gold price to fluctuate and dip towards $1535 area again. According to Goldman Sachs, the virus has already affected the growth of Oil and may also cause Gold to decline in value. As per Zaner Metals, “fears about the virus started to apply pressure on Gold. As long as the virus sustains, it could impact other commodities as well”.
Gold price is currently residing in sidelines because of depressed demand. Moreover, positive U.S. data also lead to certain weakness on the Gold. Recently U.S. Housing Starts and Exisitng Home Sales data broke the cyling of 20 months. As the Global economic slowdown phase is fading, Gold may struggle further in the process.
Can Gold surpass $1560 and head towards $1600?
Gold has been impressive with the recent bullish momentum which lead the price to $1560. Though certain bearish throwback occurred in the process, but the price managed to push higher. Currently, the price is consolidating between $1550 to $1560 area, with no definite sustainable momentum. As per current scenario, Gold can push higher towards $1600.
image: Gold 4 Hour Chart
The price is residing inside the Kumo Cloud support which is currently showing bullish pressure. As the price turned quite flat after the bounce off the $1535 area, Bulls are currently looking forward for another leg higher. A break above $1575 is the only hope for Bulls to regain momentum. On the contrary, Gold correcting create Bearish pressure which may lead the price to $1535 again.
MACD lines are residing above 0.00 area having certain Bullish cross along the way. Though the impact of this can be minimal but cannot be underestimated. A break above $1575 will confirm the upcoming Bullish move for the commodity.
Gold to bounce off $1535 or break below
Gold is currently at an indecisive state where the price may go either way with confidence. There are certain external factors affecting the growth of the Gold price but as a safe-haven it is more likely to get back up. As per current situation, price may push lower but have higher chances to bounce off $1535 and resume the Bullish trend.
Current consolidation in the Gold price can also be considered as profit taking phase for the Bulls. As the phase completes, the price can move higher as well.
To Conclude, Gold price is currently indecisive but it has greater probability to bounce and break higher. Despite, certain throwback along the way, the Bullish bias is still strong to sustain further.