Gold has had a 6.9% drop in May so far. XAU/USD now trades under a prior triangle breakout and is testing the 200-day moving average (DMA) at $1,838, indicating that the technical posture is not favourable, Benjamin Wong, Strategist at DBS Bank reports.
“Posting declines under 200-DMA $1,838 forces a relook that this corrective decline of the broader mid-term ranges. Negativity is reinforced as gold prices stay under the Ichimoku cloud amidst the persistence of a negative moving average convergence divergence (MACD) signal.”
“Gold’s negative performance of late is drawing momentum from both the unabated rise in US 10 years real yields and a plunge in gold exchange-traded funds holdings. US real yields is the one to watch out for, as gold being a noninterest-bearing asset thrives only in negative rates environment.”
“Intermediate resistance points at $1,836 and an interim channel resistance at $1,842 as first levels to break to restore flagging confidence. 100-DMA at $1,885 is equally robust.”
“A sustained break lower contours into the 38.2% Fibonacci retracement of $1,160-$2,075 at $1,726 as the first visible target.”
© 2000-2022. All rights reserved.
This site is managed by Teletrade D.J. Limited 20599 IBC 2012 (First Floor, First St. Vincent Bank Ltd Building, James Street, Kingstown, St. Vincent and the Grenadines).
The information on this website is for informational purposes only and does not constitute any investment advice.
Making transactions on financial markets with marginal financial instruments opens up wide possibilities and allows investors who are willing to take risks to earn high profits, carrying a potentially high risk of losses at the same time. Therefore you should responsibly approach the issue of choosing the appropriate investment strategy, taking the available resources into account, before starting trading.
Use of the information: full or partial use of materials from this website must always be referenced to TeleTrade as the source of information. Use of the materials on the Internet must be accompanied by a hyperlink to teletrade.org. Automatic import of materials and information from this website is prohibited.
Please contact our PR department if you have any questions or need assistance at firstname.lastname@example.org.