Gold dropped more than $40 to settle at $1662.40 yesterday. At the time of writing, Gold is trading at $1660. The intraday support levels of Gold are at $1650.30 and $1636.39. The intraday resistance levels are at $1688.16 and $1712.11. Before yesterday’s drop, Gold traded in a narrow trading range for a few days, and the $1700 acted as an important support area. A breach below $1700 indicated a further decline; however, the current price level of $1660 is a substantial support area, and the price may slightly recover from this level in the coming sessions.
Spot Gold Technical Outlook
The Stochastic and Bollinger Bands (BB) are currently oversold. The ATR (Average True Range) indicates low volatility. The MACD is below the zero line, while the Relative Strength Index (RSI) presents a neutral picture. The XAU/USD current price is below the 20, 50, and 100 periods moving average.
|
Stochastic |
Bollinger Bands |
ATR |
MACD |
RSI |
|
Oversold (6) |
Oversold (1660.76) |
21.30 (Volatility down) |
Below Zero line (-18.89) |
32 (neutral) |
The oversold and overbought indications are ideal for predicting the future price movement of a financial instrument. The general perception is that an oversold or overbought market may temporarily move in the opposite direction.
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Gold (XAU/SUD) Support and Resistance Levels
|
Support 1 |
Support 2 |
Support 3 |
Resistance 1 |
Resistance 2 |
Resistance 3 |
|
1650.30 |
1636.39 |
1612.44 |
1688.16 |
1712.11 |
1726.02 |
The support and resistance levels play a crucial role in trading. Traders expect the price to recover from a support line and drop from a resistance line. The support and resistance levels represent the demand and supply zones. The price falls when the market is oversupplied. Likewise, the price will rise when there is more demand than supply.
Gold (XAU/USD) Pivot Points
|
1 hour |
4 hours |
Daily |
Weekly |
Monthly |
|
2.02 |
-4.74 |
-14.62 |
-53.12 |
-83.03 |
Gold (XAU/USD) Trading Range
Spot Gold Daily Trading Range: 1654.16 – 1667.71
Spot Gold Weekly Trading Range: 1654.16 – 1735.13
Spot Gold Monthly Trading Range: 16541.16 – 1735.13
Spot Gold Yearly Trading Range: 1654.16 -2070.30
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Gold (XAU/USD) Trade Signal
Gold has dropped from its weekly high of $1735 and is trading nearly $85 lower. The current price level is near a strong support level that has held intact several times before. Most of the technical indicators are oversold, which might help bulls make a reasonable correction. Based on the oversold indication and FXDatapanel’s high-end trading algorithm, Gold is currently presenting a short-term buying opportunity using the following levels.
Signal Direction: Buy
Signal Timeframe: Daily
Signal Strength Level: Strong
Entry: 1653.04
Stop-loss: 1632.14
Take Profit: 1684.02
Spot Gold (XAU/USD) Future Forecast
The $1660 is a significant support level, and a breach below this level will help bears extend the downside. Failing to achieve that, bulls may come back strong and target the first resistance at $1682, which is also over the take-profit level. A weekly closing above 1682 will be ideal for the bulls to build a recovery momentum during the next week.
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