Gold prices edged higher on Thursday and moved within striking distance of two-week tops set in the previous session. What can traders expect next? GKFX shared their technical forecast.
November 22, GKFX – A combination of supporting factors helped the precious metal to regain positive traction on Wednesday and build on last week's goodish rebound from one-month lows.
Renewed US Dollar selling bias, further weighed down by disappointing US durable goods orders data, was seen as one of the key factors underpinning the dollar-denominated commodity.
Adding to this reports that the Fed might pause the rate hike cycle as early as spring 2019 provided an additional boost and lifted the non-yielding yellow metal to an intraday high level of $1230.
Meanwhile, bullish traders seemed rather unaffected by improving global risk-appetite, as depicted by a positive tone around equity markets, which tends to dampen the precious metal's safe-haven demand.
However, growing market conviction that the Fed will eventually hike rates in December might turn out to be the only factor keeping a lid on any follow-through/runaway rally for the commodity.
Market participants will be looking for any change in the Fed's forward guidance for 2019 before determining the commodity's near-term direction and placing any aggressive bets.
Gold Price Technical Forecast
Any subsequent up-move is likely to confront resistance near the $1233 level, above which the metal is likely to aim towards retesting a resistance marked by 3-1/2 month tops, around the $1243-44 region.
On the flip side, the $1225-24 region now seems to have emerged as an immediate support to defend, which if broken might accelerate the fall back towards weekly lows support near the $1218 level.
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