Gold Price Needs Stimulus, Silver Price Weighed by Lower Highs
Gold (XAU) and Silver (XAG) Prices, Analysis and Charts.
- Gold (XAU) fighting the downtrend, nearing old support zone.
- Silver (XAG) struggles. with technical resistance.
Gold (XAU) and the Downtrend
The price of gold remains hesitant to make the next move with little in the way of fundamentals to help break the current deadlock. A handful of important US data releases this week may well provide the necessary spark to break the current impasse.
The downtrend off the February high print at $1,346.8/oz. remains in play, just, while the short-term upside is capped between $1,287/oz. (61.8% Fibonacci retracement) and the May 17 high at $1,289/oz. To break the series of recent lower highs, gold needs to break and close above the May 14 high at $1,303.4/oz. A break below the $1,277 - $1,281/oz. zone opens the way to 200-day ma support, currently at $1,271.6/oz. A break either way may be sharp.
Gold (XAU) Daily Price Chart (August 2018 – May 28, 2019)
Silver (XAG) Sliding Towards the Six-Month Low
A soft start for silver this week as the three-month downtrend remains dominant and currently caps any upside moves. Silver remains under all three moving averages and below the 23.6% Fibonacci retracement level at $14,92. To initiate a turn higher, silver will need to break the pattern of lower highs and lower lows. To start this, silver will need to hold above the six-month recently made at $14,38 and close above $14,65 and $14,87. Support at $14,38 remains key in the short-term to protect the spike low at $14,05 and the full retrace back to the November 14 low at $13,90.
Silver (XAG) Daily Price Chart (August 2018 - May 28, 2019)
IG Client Sentimentshows that retail traders are 78.7% net-long gold, a bearish contrarian indicator. Recent daily and weekly sentiment shifts however give us a mixed bias.
--- Written by Nick Cawley, Market Analyst
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