Gold/Silver Technical Highlights:
See what drivers DailyFX analysts expect to move Gold in the coming weeks in the Q1 Gold Forecast.
Gold trying to sneak above resistance zone
Gold found its footing at confluent support last week, and with Friday’s slingshot higher and follow-through it is trying to slip above the 1305/1310 zone. This area dates to February of last year and demonstrated itself as strong support and resistance through until June.
With gold currently extended and hanging out just above on an intra-day basis, risk of a failure is elevated. A pullback will have the trend-line from November and the high from Jan 4 a couple handles below 1300 in focus as support.
This may make for an opportunity to buy on a dip should the decline unfold in a manner which isn’t aggressive. A strong reversal will put a damper on a pullback as a buying opportunity. Shorting doesn’t hold a lot of appeal at the moment given it is the top of a strong move higher. For now, it’s wait-and-see time.
Check out the IG Client Sentiment page to see how changes in trader positioning can help signal the next price move in gold and other major markets.
Gold Daily Chart (Trading around resistance)
Silver at t-line, 2.5-year resistance zone
Silver bolted higher off the 200-day MA, now pressed firmly up against a trend-line dating back to the July 2016 spike-high and into a zone beginning a month before the spike-high took shape. This makes a formidable spot for silver and one to possibly look for weakness to set in from. If silver trades a bit higher it will be facing off with a trend-line from 2003 (dotted green) and a t-line from April 2017. A lot of work lies ahead for silver to get into the clear.
Silver Daily Chart (t-line resistance levels)
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at@PaulRobinsonFX