Gold Price Analysis: XAU/USD to rise towards the $1950-$1967 resistance zone – DBS Bank
|Gold (XAU/USD) has convincingly traded above its 200-day moving average (DMA) at $1843. Technically, a move over interim $1922 resistance would target the $1950-$1967 price layer which should offer sturdy resistance, Benjamin Wong, Strategist at DBS Bank, reports.
See: Gold Price Analysis: XAU/USD has steam to surge above the $2072 2020 high – Commerzbank
Bulls yet to see the finish line
“Gold bulls continue to flex their muscle, and gold price continues its upward trajectory with a successful break of the key 200-DMA at $1843. A key factor behind gold’s resurgence is that US real rates have started to slope lower as Federal Reserve officials reiterate their dovish commitment, pulling USD back towards January lows. As a non-interest-bearing asset, such a development positively underpins gold prices.”
“Gold’s rally is consistent with our warning in early March that the prior April-June 2020 price congestion zone in the $1660-$1670 zone will spawn a bullish price reversal. Technically, the rally has been supported by a bullish $1676 double bottom, prodded further by a bullish inverse head-and-shoulders bottom on the shorter time frame four-hourly chart.”
“XAU/USD’s rally of late is not exactly a fresh phenomenon as the bull quietly came back to the ring in late March – this implies that speculative buying is once again entering longs at poorer levels. Taking the impulse leg down to the $1676 double bottom, a fully bloomed 1.618% price extension calibrates at $1950 – so we are expecting the $1950-$1967 price layer to offer some sturdy resistance. Until then, there is a fair chance bulls have yet to see the finish line.”
“Gold’s rally up is intact unless gold returns lower under $1834, which would be the first signal that the ongoing rally is once again running out of steam.”
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.