Skip to content
News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
Oil - US Crude
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Gold Price Forecast: Gold Plunges to Key Support- XAU/USD FOMC Levels

Gold Price Forecast: Gold Plunges to Key Support- XAU/USD FOMC Levels

Michael Boutros, Strategist

Gold Technical Price Forecast: Neutral

Advertisement

Gold prices marked a second consecutive weekly decline on Friday with XAU/USD trading down 1.87% to trade at 1754 ahead of the US close. The sell-off takes price into a key support pivot and we’re looking for possible price inflection off this threshold in the days ahead with the FOMC interest rate decision on tap next week. These are the updated targets and invalidation levels that matter on the XAU/USD weekly technical chart. Review my latest Weekly Strategy Webinar for an in-depth breakdown of this gold technical setup and more.

Starts in:
Live now:
Oct 10
( 12:10 GMT )
Live Weekly Strategy Webinars on Mondays at 12:30GMT
Weekly Scalping Webinar
Register for webinar
Join now
Webinar has ended

Gold Price Chart - XAU/USD Weekly

Please add a description for the image.

Chart Prepared by Michael Boutros, Technical Strategist; Gold on Tradingview

Notes: In my last Gold Weekly PriceOutlook we noted that the XAU/USD had, “rallied more than 9% off yearly low with XAU/USD now attempting to breakout above a key resistance pivot.” The focus was the 61.8% retracement of the May decline & the 52-week moving average which converged on downtrend resistance at 1825/29. Price registered a high at 1834 before reversing sharply lower with the decline now testing a key support zone at the 61.8% Fibonacci retracement of the August rally / 2020 April high & May close high at 1738/47- looking for major price inflection off this threshold.

A break lower would threaten a deeper correction towards the lower parallel (currently ~1715s) and critical support which remains steady at 1670/82. Initial weekly resistance now stands with the pitchfork (near ~1805) backed by 1822/27. Ultimately a breach / close above the yearly high-week close at 1849 is needed to mark resumption of the broader gold uptrend.

Gold Forecast
Gold Forecast
Recommended by Michael Boutros
Download our latest quarterly Gold Price Forecast
Get My Guide

Bottom line: Gold has plunged nearly 5% off the Monthly high with the sell-off now probing key weekly support here at 1738/47- looking for a pivot here with the Fed interest rate decision on tap. From at trading standpoint, a good zone to reduce short exposure / lower protective stops – rallies should be capped by the upper parallel IF price is indeed heading lower with a break / close below threatening a deeper pullback towards the yearly lows. Review my latest Gold Price Outlook for a closer look at the near-term XAU/USD technical trade levels.

For a complete breakdown of Michael’s trading strategy, review his Foundations of Technical Analysis series on Building a Trading Strategy

Gold Trader Sentiment – XAU/USD Price Chart

  • A summary of IG Client Sentiment shows traders are net-long Gold- the ratio stands at +5.75 (85.19% of traders are long) – typically bearishreading
  • Long positions are15.37% higher than yesterday and 17.60% higher from last week
  • Short positions are13.80% lower than yesterday and 27.20% lower from last week
  • We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests Gold prices may continue to fall. Traders are further net-long than yesterday and last week, and the combination of current positioning and recent changes gives us a stronger Gold-bearish contrarian trading bias from a sentiment standpoint.
Gold Bullish
Data provided by
of clients are net long. of clients are net short.
Change in Longs Shorts OI
Daily -5% 27% 2%
Weekly -10% 33% -3%
Learn how shifts in Gold retail positioning impact trend
Get My Guide

---

Previous Weekly Technical Charts

- Written by Michael Boutros, Currency Strategist with DailyFX

Follow Michael on Twitter @MBForex

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

DISCLOSURES