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Gold Price Outlook: XAU/USD Reaches a Monthly High, US Equities Limits Gains

Gold Price Outlook: XAU/USD Reaches a Monthly High, US Equities Limits Gains

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Gold Price Forecast:

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Gold prices have recently reached a one-month high after the number of worldwide Covid cases reached a record high.

However, although rising inflation and geopolitical factors have supported the demand for the precious metal, the Santa Claus rally and a stronger Dollar has hindered further progression.

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Gold (XAU/USD) Technical Analysis

Over the past three weeks, Gold bulls have managed to regain temporary control over the systemic, prominent trend in an effort to drive prices back towards the 38.2% Fibonacci retracement of the 2020 move at $1,835.

Although the downward trajectory from the August 2020 high currently remains intact, prices have risen above the 50-week moving average, currently providing support at the key psychological level of $1,800.

Gold (XAU/USD) Weekly Chart

Chart prepared by Tammy Da Costa using TradingView

Meanwhile on the daily time-frame, price action has temporarily stalled at the 50% retracement level of the 2021 move which continues to provide resistance for the imminent move at $1,818.

As bulls and bears battle it out, the CCI (commodity channel index) has broken above the normal range, a potential indication that XAU/USD may be overbought.

Gold (XAU/USD) Daily Chart

Chart prepared by Tammy Da Costa using TradingView

Gold Mixed
Data provided by
of clients are net long. of clients are net short.
Change in Longs Shorts OI
Daily -2% -2% -2%
Weekly 3% 16% 10%
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--- Written by Tammy Da Costa, Analyst for DailyFX.com

Contact and follow Tammy on Twitter: @Tams707

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

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