Gold Price Analysis: Bears finally catch a break

Gold Price Analysis: Bears finally catch a break

  • Gold bears take control and break into fresh bearish territory. 
  • Further downside on the cards, but market volatility is here to stay.

From an ongoing analysis, the bears have finally managed to catch the break that they were looking for and the prior analysis had forecasted originally, here:

and again, here:

Original forecast

XAU USD%20(80) 637393565166091744

End result

XAU USD (89) 637395164358159173

To be continued…

Next?

As illustrated, the trendline resistance held and the price eventually crumbled to the first target area. 

So where is next?

Casting minds back to the original analysis, the expectations are of a deeper retracement of the monthly bullish impulse to at least a 38.2% Fibonacci target.

XAU USD (91) 637395170934272259

However, markets rarely move this far without offering a discount, especially in an asset class such as gold which is proving to be very choppy of late offer a higher ATR for the year 2020:

image 637395175203782714

It is reasonable to expect a pullback to the prior support structures, which are now expected to act as resistance:

XAU USD (92) 637395180652740035

There is a cluster of Fibonacci retracement confluence with the various resistance structures. 

If the price does indeed hold below these, then the monthly 38.2% Fib in the $1,840 area is on the cards.

Gold levels

Credit: FX Street

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