Gold found resistance at $1700 area and may push lower towards $1600. After a Bullish impulsive momentum from $1600, Gold reached the 2013 high. Let’s check Gold Technical Analysis for more levels and insights.
March 9, 2020, | AtoZ Markets – Gold successfully reached at $1700 area after the market open today. The Gold has been quite impulsive and non-volatile since it broke above $1600 area last week. The price of Gold is currently pushing lower after rejecting the resistance found at $1700.
Gold jumps past $1700 area which is the seven years high on Coronavirus fears. The widening of the Coronavirus outbreak and jerk in Crude Oil and equities knockdown brought investors for the safe havens. Moreover, Spot Gold rose 1.5% to $1699 per ounce today, and it’s highest since January 2013. Asian stock market fell as investors failed to hedge the economic breakdown from Coronavirus fears, and Saudi Arabia dropped its Oil price by 20% from the correct selling price.
According to the National Health Commission, China had confirmed 40 cases of infections on Sunday. It took the numbers in a total of 80,735. Italy government had ordered a lockdown of large parts of the north of the country as Coronavirus virus spreading so fast. The whole world in a crisis after Coronavirus shutting down the biggest economic countries.
Gold Found Resistance may Continue to Push Lower
Gold is currently residing near $1660 area and trying to push lower. After Gold found resistance at $1700 area, Gold has become quite impulsive and had a strong 4-hour Bearish Engulfing Bar. The Bears may take over the market and may push lower towards $1600 support area.
Image: Gold 4 Hour Chart
According to the 4-hour chart, the price of Gold is now trading at $1660 area after a strong Bearish close. Gold may now pullback 50% of the engulfing bar before continuing the Bearish pressure. If Gold can break below $1660 area, the Bears may take the price lower towards $1600 area again.
Moreover, the dynamic levels of 20 EMA is residing near the current price, which may help the Bulls to retrace 50% of the engulfing bar. The price broke the Tenkan line, and now it may work as a dynamic resistance. Bears need to take over the dynamic levels before continue to push lower. On the other hand, the MACD lines are showing Bearish regular divergence, and the MACD histogram volumes are slopping down gradually. It is an indication that Bears may dominate the Gold market soon.
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Gold Bulls can Continue with the Trend in place
According to the Daily chart, Gold found resistance at $1700 area and trying to further lower. After an impulsive and non-volatile Bullish pressure, the price reached its highest pick of 2013. Bullish pressure may continue further but certain retracement may occur along the way. If Gold can retrace lower towards $1600 area at least, the Bulls may gain the Bullish momentum after a bounce from support with the target of $1700 again.
Image: Gold Daily Chart
On the other hand, the dynamic level of 20 EMA is residing below the current price, along with the Kijun line and the Tenkan line. It may pull the price lower towards $1600 area as Mean Reversion. Besides, the MACD histogram volumes are showing Bearish regular divergence and the MACD line’s cross over is in the making. Currently, it is an excellent indication for the price to push lower in the coming days.
To conclude, Gold is currently retracing lower after rejecting the $1700 Resistance area. If Gold can reach lower towards $1600 area and have a strong Daily close above the price, Bulls may intervene to continue the Bullish trend in place.