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Gold Price Technical Outlook: More Gains on the Cards

Gold Price Technical Outlook: More Gains on the Cards

2019-08-27 10:30:00
Martin Essex, MSTA, Analyst
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Gold price, news and analysis:

  • The price of gold slipped back Monday, filling a gap on the daily chart.
  • However, it has hit a new six-year high Tuesday and that could mean further gains are on the way.

Gold price technical outlook positive

The price of gold fell back Monday, filling a gap on the daily chart (see below). However, it is climbing again Tuesday, reaching a new six-year high and suggesting that the multi-year advance in the price of the precious metal is not yet exhausted.

Currently, the price is above the 20-day moving average, which is above the 50-dma and that in turn is above the 100-dma – suggesting a classic upward trend. Moreover, the 14-day relative strength index, which has flirted with the 70 “overbought” level, is now back below it, adding to the positive chart outlook.

Gold Price Chart, Daily Timeframe (May 28 – August 7, 2019)

Latest gold price daily chart.

Chart by IG (You can click on it for a larger image)

You can find a more fundamentally-based comment on the gold price here

Near-term, there is support for the gold price at last Friday’s $1,493.61 low and just above that at $1,507.68, where the 20-dma currently kicks in. For resistance, however, it is necessary to look at the weekly chart below.

Gold Price Chart, Weekly Timeframe (October 8, 2012 – August 7, 2019)

Latest gold price weekly chart.

Chart by IG (You can click on it for a larger image)

This shows a high of $1,590.40 in the week of April 8, 2013 and, above that, a high of $1,616.83 in the week of March 8, 2013. These, plus the $1,600 “round number” between them can be regarded as the near-term targets. Note, however, that volume was high when the price fell Monday, despite a bank holiday in the UK, and that can be read as a warning against irrational exuberance.

How to Trade Gold: Top Gold Trading Strategies and Tips

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--- Written by Martin Essex, Analyst and Editor

Feel free to contact me via the comments section below, via email at martin.essex@ig.com or on Twitter @MartinSEssex

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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