Gold Price Forecast: XAU/USD sees a dead cat bounce, with death cross in play
Premium|Take advantage of 60% OFF on your first month.
Grab this special offer, it's 7 months for FREE deal! And access ALL our articles and analysis.
You have reached your limit of 5 free articles for this month.
BLACK FRIDAY SALE! 60% OFF!
Grab this special offer, it's 7 months for FREE deal! And access ALL our articles and analysis.
CLAIM OFFER- Gold’s recovery appears shallow amid a risk-on mood.
- Covid vaccine and stimulus optimism led reflation trade weighs.
- Weaker DXY lends support to XAU/USD but the daily chart warrants caution.
Gold (XAU/USD) has stalled its three-day decline but struggles to find its feet amid the upbeat market mood. The reflation trade keeps the market mood buoyed on prospects of US stimulus and coronavirus vaccine-driven faster global economic recovery.
The riskier assets such as the Treasury yields are on the rise, weighing negatively on the non-yielding gold. The renewed US-Iran geopolitical tensions fail to attract the gold buyers, as the daily technical chart continues to paint a bleak picture, in absence of fresh economic releases from the US.
Gold Price Chart - Technical outlook
Gold: Daily chart
As observed in the daily chart, the gold price faces stiff resistance around $1827, as of writing.
The near-term technical set up favors bears after a death cross was charted on the said timeframe a day before. The death cross formation is registered after the 50-daily moving average (DMA) cuts the 200-DMA from above.
Further, the 14-day relative strength index (RSI) trades within the bearish region, backing the case for additional downside.
A test of the Feb 8 low of $1808 remains on the sellers’ radar, below which the January 18 low of $1803 could be put at risk.
Meanwhile, the bearish bias remains intact so long as the price holds below the 21-DMA at $1838. The next powerful hurdle awaits at $1858, the confluence of the 50 and 200-HMAs.
- Gold’s recovery appears shallow amid a risk-on mood.
- Covid vaccine and stimulus optimism led reflation trade weighs.
- Weaker DXY lends support to XAU/USD but the daily chart warrants caution.
Gold (XAU/USD) has stalled its three-day decline but struggles to find its feet amid the upbeat market mood. The reflation trade keeps the market mood buoyed on prospects of US stimulus and coronavirus vaccine-driven faster global economic recovery.
The riskier assets such as the Treasury yields are on the rise, weighing negatively on the non-yielding gold. The renewed US-Iran geopolitical tensions fail to attract the gold buyers, as the daily technical chart continues to paint a bleak picture, in absence of fresh economic releases from the US.
Gold Price Chart - Technical outlook
Gold: Daily chart
As observed in the daily chart, the gold price faces stiff resistance around $1827, as of writing.
The near-term technical set up favors bears after a death cross was charted on the said timeframe a day before. The death cross formation is registered after the 50-daily moving average (DMA) cuts the 200-DMA from above.
Further, the 14-day relative strength index (RSI) trades within the bearish region, backing the case for additional downside.
A test of the Feb 8 low of $1808 remains on the sellers’ radar, below which the January 18 low of $1803 could be put at risk.
Meanwhile, the bearish bias remains intact so long as the price holds below the 21-DMA at $1838. The next powerful hurdle awaits at $1858, the confluence of the 50 and 200-HMAs.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.