Gold price caught some fresh bids at the start of a new trading week and 2-1/2 month tops during the early European session. Where is the yellow metal now headed? Today’s gold technical forecast reveals.
15 October, GKFX – After Friday’s modest retracement, a combination of supporting factors helped the precious metal to regain positive traction and build on last week’s strong positive momentum.
Gold Price Regains Bullish Momentum
The US Dollar struggled to preserve early gains and has now eroded a part of Friday’s goodish rebound from two-week lows, which was eventually seen underpinning demand for the dollar-denominated commodity.
Adding to this, a fresh wave of global risk-aversion trade, as depicted by a weaker tone around equity markets, provided an additional boost to the precious metal’s safe-haven status and remained supportive.
Meanwhile, the positive momentum, to the highest level since July 26, seemed rather unaffected by a modest uptick in the US Treasury bond yields, which tends to drive flows away from the non-yielding yellow metal.
Today’s up-move could further be attributed to some follow-through technical buying, especially after last Thursday’s bullish break through a broader trading range held since late August, or over six weeks.
A subsequent move beyond 100-day SMA, for the first time since late April now seems to have opened room for an extension of the bullish momentum as market participants now look forward to the release of US monthly retail sales data for some fresh impetus.
Gold Technical Forecast
Momentum beyond $1234 horizontal zone is likely to get extended towards $1242 resistance before the commodity eventually darts towards testing $1248-50 supply zone.
On the flip side, the $1228 region (100-DMA) now seems to protect the immediate downside, below which the metal could slide back towards testing $1216 support area.
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