Gold prices edge higher today and are set to post the second bullish day in a row. In the previous week, the precious metal hit a fresh 19-month low of 1,160 before heading higher. Also, the price advanced above the 20-simple moving average (SMA) in the 4-hour chart and is currently approaching the 40-SMA, with the technical indicators showing some improvement as well; the Relative Strength Index (RSI) climbed into positive territory, above the 50 level but not much, and the MACD oscillator continues the upward rally above its red-trigger line, indicating that positive momentum could hold in the short-term.
If prices continue to head higher, resistance could come from the 23.6% Fibonacci retracement level of the downleg from 1,309 to 1,160, around 1,195. A jump above this region, would reinforce the short-term bullish view and open the way towards the 1,200 psychological level.
However, should a downside movement take form again, immediate support will likely come from the 20-SMA near 1,179. Further losses could drive gold until the 1,172 before being able to challenge the 19-month low of 1,160.
Overall, the outlook remains negative since prices hold below all the moving average lines and the bearish cross between the 50- and the 200-day SMA stays in place.
