Gold Path Ahead
Evening Update: Will Gold move above 65,000 or will it drop back below 60,000 ?
For the past three weeks, the gold price has been weakening; it has dropped from 63,500 to 62,000 area and is currently trading close to that level. Gold experienced a strong rebound from 56,000 and reached the 64,000–64500 range in December of last year. The chart shows that gold is on an uptrend and that every down move presents a buying opportunity. We're going to talk about the Gold road ahead and what to expect in the upcoming weeks.
- For gold, the 59,500–60,000 mark is a solid support zone.
- We could see a spike in gold prices in the upcoming weeks, therefore any decline in price would be an excellent time to purchase gold.
- The chart predicts a decline in gold prices over the next few days, but buyers may be willing to take advantage of this weakness, and once the price of gold touches the 59,00–60,000 support zone, it will likely rise sharply.
Please study the crucial gold chart to comprehend the price movement of it. October had a great rebound for gold from 56,000 zones and we saw a big increase towards 64,000–64,500 zones till december. For commodities like gold, nearly 8000 points of upward movement in less than two months is a very strong rebound. Since gold has already jumped and made a strong upward move, it may now exhibit some weakness going forward. Additionally, the weekly chart shows RSI bearish divergence.
Please refer to the chart below, which displays the RSI negative divergence in gold. We shall discuss it in further detail.
Please refer to the above chart, which shows that although the price of gold increased and bounced, the RSI made lower lows, indicating an RSI negative divergence.
RSI Divergence : When price swings against the RSI, it is called an RSI divergence. In other words, a shift in momentum may appear on a chart ahead of a corresponding change in price. When an overbought reading on the RSI is followed by a lower high that shows up with higher highs on the price, this is known as a bearish divergence.
Putting all the pieces together, we can also state that going forward, Gold may fall into the 59,500-60,000 zone and that will be the nice opportunity to go long for 65,000 as a target.
The past several weeks have seen a strong influx of gold bulls, and each decline presents an opportunity to purchase gold. The presence of RSI negative divergence suggests that traders should hold off on buying gold until a new entry occurs. This is because there is potential support in the 59,500–60,000 zone, where the risk–reward ratio is quite favorable for gold, with a target price range of 64,500–65,500.
Please check the support and resistance level of Gold on the weekly chart. All levels are in spot chart :
|
Gold |
Support |
Resistance |
|
Level 1 |
60,000 |
64,500 |
|
Level 2 |
59,500 |
65,000 |