HomeContributorsTechnical AnalysisWill Gold Resume Its Prevailing Uptrend?

Will Gold Resume Its Prevailing Uptrend?

  • Gold stabilizes after last week’s sharp slide
  • Oscillators point to corrective phase
  • A break of record high could challenge $2,500
  • For the outlook to change, a dip below $2,145 may be needed

Gold stabilized on Friday and is recovering ground today, following a decent drop from its record high at around $2,450 on May 20. The precious metal remains well above the uptrend line drawn from the low of October 6 and above all three of the plotted exponential moving averages (EMAs), which means that the broader outlook remains positive.

The daily oscillators are also corroborating that view, suggesting that last week’s slide was just a corrective phase within the broader uptrend. The RSI has started rebounding from near its 50 line, while the MACD, although below its trigger line, is still lying above zero.

If the bulls are strong enough to stay in the driver’s seat, they could soon aim for another test near the record of $2,450, the break of which will take the price into uncharted territory and perhaps aim for the round number of $2,500. With no prior highs and inside swing lows to mark future resistance zones, a break above $2,500 could pave the way for the next psychological area, at around $2,600.

On the downside, for the outlook to start shifting to bearish, a dip below $2,145 may be needed. This would confirm the break of the aforementioned uptrend line as well and may allow declines towards the $2,065 zone.

To sum up, gold corrected lower last week, but the bulls have managed to hold it in an uptrend, which suggests that there are still chances for a new record high soon.

XM is a fully regulated next-generation financial services provider of online trading on currency exchange, commodities, equity indices, precious metals and energies, with services to clients from over 196 countries worldwide. Founded in 2009 by market experts with extensive knowledge of the global forex and capital markets and with the aim to ensure fair and reliable trading conditions for every client, XM has reached international recognition by virtue of its unbeatable execution of orders, spreads as low as zero pips on over 50 currency pairs, gold and silver, flexible leverage up to 888:1, and personalized customer engagement to foster clients’ success.

Featured Analysis

Learn Forex Trading