Gold Q1 Technical Forecast: Pullback to Offer Opportunity in Early 2019
The recovery in Gold prices continued in the fourth quarter of 2018 after rebounding off confluence support near 1171 back in August. The advance is poised to close the year more than +9% off the lows and heading into the start of 2019 the focus is confluence technical resistance near 1270 – a region defined by the 52-week moving average, the upper median-line of the broader descending pitchfork (blue) and basic channel resistance (red). A breach weekly close above this threshold is needed to keep the long-bias viable targeting the 61.8% retracement of the yearly range at 1287 and the 2018 open at 1302. Otherwise, a return back to the downside can’t be ruled out just yet.
Gold Price Chart: Weekly Timeframe (January 2015 to December 2018)
As traders make their way into the first quarter of 2019, interim support rests at 1236 backed by the December open at 1220. This level converges on channel support into late-January and a break below would risk a larger setback for Gold prices towards the lower parallel, with broader bullish invalidation steady at the yearly low week close at 1184.
--- Written by Michael Boutros, Currency Strategist
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