Gold Price Falls Near Important Support


Gold price fell on Monday as the dollar firmed in the wake of indications from the U.S. Federal Reserve last week that it will pursue a tighter monetary policy. What next should traders expect?

1 October, GKFX – The Fed raised U.S. interest rates last week and said it planned four more increases by the end of 2019 and another in 2020, amid steady economic growth and a strong job market.

Higher U.S. interest rates tend to boost the dollar and push bond yields up, putting pressure on gold prices by increasing the opportunity cost of holding non-yielding bullion.

Gold Price Falls Near Important Support

Friday’s goodish recovery move from 61.8% Fibonacci retracement level of the $1160-$1210 recent up-move stalled near an important confluence support break-point turned resistance.

The mentioned hurdle comprises of 38.2% Fibonacci retracement level and a short-term ascending trend-line, a part of a symmetrical triangular formation on short-term charts.

Given that it remains well below important intraday moving averages – 50, 100 & 200-period SMAs, a convincing break below Friday’s swing low will reinforce last week’s bearish breakdown.

Gold 4-hourly chart

Spot Rate: $1186.94

Daily High: $1192.41

Trend: Bearish

Resistance

R1: $1192.41 (current day swing high)

R2: $1198.30 (horizontal zone)

R3: $1201.00 (23.6% Fib. level)

Support

S1: $1180.67 (Friday’s swing low)

S2: $1174.06 (recent daily closing low)

S3: $1160.19 (near 20-month low set on August 16)

Disclaimer

This article was written by analysts at GKFX. The information provided herein is for general informational and educational purposes only. It is not intended and should not be construed to constitute advice.

If such information is acted upon by you, then this should be solely at your discretion, and GKFX will not be held accountable in any way.

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