Gold price is now trading at 1220 which is lower than the neckline of the head and shoulder pattern. Should traders expect a decline in price? Gain insight into the following XAUUSD analysis.
17 October, OctaFX – Wall Street gained yesterday after earnings data overshadowed recent news about a slowing economy and interest rates. The Dow, Nasdaq, and S&P gained by 547, 214, and 60 points respectively.
Stock Price Soars
These results were helped by Goldman Sachs, Morgan Stanley, BlackRock and Johnson & Johnson. In the aftermarket, results from Netflix showed that revenues and earnings had beaten analysts’ forecasts leading to a sharp increase in the stock price.
Today, the Asian markets followed Wall Street with the Nikkei, Hang Seng, and China A50 gaining by 331, 17, and 43 points respectively. In Asia-Pacific, the Australian ASX gained by 63 points.
Last week, the XAUUSD pair jumped sharply to 1230, which was the highest level since July. This was as traders moved to safe havens following the worries of a slowed economic growth and high interest rates.
This week, the pair has remained closer to these levels as the focus on global growth cools down. It is now trading at 1220, which is lower than the neckline of the head and shoulder pattern.
This is an indication that the pair will likely continue to move lower. This is confirmed by the slow change of direction of the 14 and 28-day EMAs.
This article was provided by OctaFX. It should NOT substitute for professional marketing consulting. Forex margin trading involves substantial risks. Forex margin trading exposes participants to risks including, but not limited to, changes in political conditions, economic factors, and other factors. All of which may substantially affect the price or availability of one or more foreign currencies.