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
More View more
Gold Technical Forecast: Gold Breakdown Takes Another Step

Gold Technical Forecast: Gold Breakdown Takes Another Step

Michael Boutros, Strategist

Gold Technical Price Forecast:XAU/USD Weekly Trade Levels

Advertisement

Gold prices are down more than 2.3% this week with XAU/USD breaking key technical support before plunging to multi-week lows. The move threatens further losses in the weeks ahead and we’re on the lookout for a low heading into the May opening-range. These are the updated targets and invalidation levels that matter on the XAU/USD weekly price chart. Review my latest Weekly Strategy Webinarfor an in-depth breakdown of thisgold technical setup and more.

Gold Price Chart - XAU/USD Weekly

Gold Price Chart - XAU/USD Weekly - GLD Trade Outlook - GC Technical Forecast

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

Notes: In my last Gold Weekly PriceOutlook we noted that a near-term breakout in XAU/USD had shifted, “the focus back towards key resistance around 2K – we need close above this threshold to mark resumption. From a trading standpoint, look to reduce portions of long-exposure / raise protective stops on a stretch towards 1988-2001- any pullbacks should be limited to the 1903 IF price is indeed heading higher.” Gold registered a high at 1998 in the following days before marking and outside-weekly reversal with the subsequent plunge taking price back through key support at 1903/20- a region defined by the May high-close and the 38.2% Fibonacci retracement of the August rally. The threat is lower while below this threshold.

Weekly support objectives from here eyed at the 2021 high-week close at 1849 backed by a critical confluence at the 100% extension of the yearly decline / 61.8% retracement of the 20221 rally at 1818/28- look for a larger reaction there IF reached. Initial resistance now back at 1920 with a breach / weekly close above the parallel (red near ~1934) needed to alleviate further downside pressure.

Bottom line: A technical breakdown of a multi-week range in gold keeps the risk tilted to the downside heading into the close of the month. From a trading standpoint, rallies should be capped by 1920 IF price is heading lower on this stretch with a close this week below 1903 needed to validate this breakdown. 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

Gold Trader Sentiment - XAU/USD Price Chart - GLD Retail Positioning - GC Technical Forecast
  • A summary of IG Client Sentiment shows traders are net-long Gold- the ratio stands at +4.27 (81.02% of traders are long) – typically bearishreading
  • Long positions are2.80% lower than yesterday and 1.99% higher from last week
  • Short positions are 5.46% lower than yesterday and 24.23% 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.

---

Previous Weekly Technical Charts

- Written by Michael Boutros, Technical 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