Gold price edged higher on Thursday morning, after a four-day pullback from $2088 (Dec 28 high) found a footstep at $2030 (50% retracement of $1973/$2088 upleg).
This points to initial signal of a healthy correction of larger uptrend, as technical studies on daily chart remain in predominantly bullish configuration and the metal continues to benefit from wide expectations that the Fed will start cutting interest rates in 2024, as well as signals that the US economy is likely to slow this year.
However, fading expectations of an early start of rate cuts in March on significant uncertainty in Fed’s rate cut outlook, continue to produce headwinds and keep the downside vulnerable.
Break of pivotal barriers at $2052/55 (Fibo 38.2% retracement of $2088/$2030 bear-leg / 10DMA) is needed to keep fresh bulls in play for stronger recovery.
Fibo 61.8% and 76.4% levels at $2066 and $2074 respectively, mark next targets, guarding key barrier at $2088, break of which would further strengthen bullish structure for renewed attempt through $2100.
Caution on failure to clear $2050, which would keep in play risk of retesting $2030 support and possible deeper drop on break.
Res: 2052; 2055; 2066; 2074.
Sup: 2040; 2030; 2017; 2009.
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