Gold Reached Peak at $1600 area may struggle and hold. Gold breaks $1585 resistance area with an impulsive manner which leads the price toward $1600 area. Let’s check Gold Technical Analysis for more levels and insights.
February 19, 2020 | AtoZMarkets – Gold reached the peak at $1600 key area after an impulsive move. Recently Gold bounced from $1585 area and able to reach higher at $1600 again. As per current price action, the price may retrace towards $1585 support area for further bullish momentum.
The spread of the new Coronavirus impact leads the Gold price at its highest level. In Singapore, spot Gold added 0,2% to $1,604.82 an ounce. Gold touched $1611 in early January, the highest since 2013, as geopolitical tensions flared.
As per Gold on an upward trajectory yesterday, Apple warned about not hitting Q1 target dew to the impact of Coronavirus. After a warning from Apple about a hit sales negatively revived fears of global economic slowdown due to the Coronavirus issue. Gold finds stability from increased risk aversion, as reflected also in falling stock market and declining bond output. Moreover, Peter Spina, the president and chief executive of GoldSeek, said Gold price swing past $1600 could lead to move higher, with the targets of $1700-$1900 in upcoming months.
Gold Reached Peak at $1600 may retrace toward $1585 area
Gold is currently residing near $1600 area, which may retest $1585 support area soon as retracement. The dynamic levels are also residing near $1585 area, it may work as a support for upcoming Bullish pressure.
image: Gold 4 Hour Chart
According to 4 hour chart, after a non-volatile and impulsive Bullish pressure price now becoming volatile. Bears may take control and lead the price downward $1585 area at least before Bullish pressure regains its momentum.
The dynamic level of 20 EMA is also far away from the current price which may pull the price down to support area as Mean Reversion. The Kijun line and the Tenkan line may work as a confluence. Moreover, the MACD lines are also far away from 0.00 level which may result in some Bearish crossover with upcoming Bearish price action.
Gold may Find Support at $1590
image: Gold Daily Chart
After a bounce from $1580 area Gold managed to push higher toward $1600 area with a daily close. The price is currently in consolidation and may push the price down to $1585 support zone. If Bears manages remain below $1600 area with a daily close, Bearish Momentum may continue further. The dynamic level of 20 EMA is far from the current price, which may pull the price down using Mean Reversion. Additionally, the Kijun line and the Tenkan line has also worked as a confluence along with dynamic level 20 EMA.
Additionally, the MACD indicator is showing Bearish divergence which can also add some hope to Bears that may take over the market soon.
To conclude, As per non-volatile and impulsive momentum Gold may retrace down towards $1585 before it continue higher. If Bulls manage to hold the momentum above $1585, then Gold may reach its highest peak.