The price of Gold is correcting lower and may reach the $1600 support area as a retracement. Bearish pressure may continue further before Gold continues higher towards the $1700 area. Let’s check Gold Technical Analysis for more levels and insights.
February 28, 2020, | AtoZMarkets – Gold is declining after violating an extended volatile period. The price is currently residing near $1630 as Bearish pressure continues. If Bears can push the price down towards the $1600 support area, Bullish momentum may continue further in the coming days.
Gold Price Fundamental Highlights
The price of gold declined for the second day after Asian markets open today. Gold price slipped after reaching $1690, which was seven years high. Investors expected the Gold would sustain the momentum, and take the price higher toward $1700 an ounce. Additionally, Ed Moya, the Analyst at New York OANDA, said earlier, “Pandemic fears will bolster Gold, as well as the central bank and government stimulus, trade angst, and political uncertainty.”
On the other hand, the World Health Organization said, “The Coronavirus outbreak has the potential to become nationwide and is a decisive stage.” The U.S. stock market lost about 3% each overnight as Coronavirus fears are increasing day by day. Traders are in full attention to Federal Reserve’s that coming next month. The Central Bank may release more easing policies, including cutting interest rates to protect the United States from the deadly Coronavirus impact.
Gold is Correcting Lower and May Continue Towards $1600
Gold is currently trading near $1635 and may continue to decline toward $1600 soon. After rejecting the $1630 area, Gold became volatile and corrective as the Bulls tried harder to push the price higher. However, the Bears managed to take over the market and continue selling pressure.
image: Gold 4 Hour Chart
According to the 4-hour chart, the price is hovering near $1635 as Gold price corrects lower. After an extended period of volatility, Gold managed to push lower to retrace toward the $1600 area. The dynamic level of 20 EMA is residing above the price, along with the Kijun line and the Tenkan line, which may work as strong resistance to support the Bearish pressure. On the contrary, Kumo Cloud may act as strong dynamic support leading the price into specific corrections along the way.
Moreover, the MACD lines are slopping down gradually as the Bears taking over the market. Additionally, the MACD histogram volumes are also residing below 0.00 line and may act as a confluence for the Bears in control.
Bullish Trend May Continue Towards $1700 After Retracement
According to the Daily chart, Gold is now trading at $1630 area. After rejecting the $1690 area, sellers pulled the price down as retracement. If the selling pressure continues further, Gold may reach $1600 are soon as expected. As the overall bias is Bullish, the price may find support at $1600 and may continue its Bullish trend towards the $1700 area.
image: Gold Daily Chart
Moreover, The dynamic level of 20 EMA is residing near $1600 support and may pull the price higher as Mean Reversion. Additionally, the MACD indicator lines may cross each other toward the downside, which may support the Bears to take the price more down to retrace.
To conclude, If Gold able to push the price down towards $1600. It may continue its Bullish bias toward $1700 key area in the coming days.