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Could Gold Eventually Fall to $1790/80?

Published 02/09/2023, 04:41 AM
Updated 07/09/2023, 06:31 AM
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Gold bearish engulfing candle on the daily chart & then the weekly chart suggested the 3-month rally in Gold just ended.

We are likely forming a bear flag on the short-term charts, meaning eventually, we will break lower.

Hourly XAU Chart

Silver huge bearish engulfing candle on the weekly chart is a sell signal as we take out all the candles for the 7 weeks last week.

We hold the most important support of the week at 2210/00 but with only a small bounce for scalpers.

Crude Oil WTI Futures April was higher for the 3rd day yesterday.

Today's Analysis

Gold crashed almost $100 from Wednesday's high in just 2 days, leaving a brutal bull trap for those who bought into longs over the past 3 weeks (& did not take the profit).

Further losses look highly likely, with a break below minor support at 1855/50 acting as the sell signal to target 1830/25. Eventually, we could fall as far as 1790/80.

Shorts at 1882/85 worked perfectly, with a high for the day exactly here again yesterday. Today we can try this again with a stop above 1890. A break higher, however, can target 1896/98.

Silver is holding the most important support of the week at 2210/00 perfectly so far. A low for the day exactly here yesterday, but longs need stops below 2185. A break lower is a sell signal & sees 2200/2220 act as resistance to target 2170/60 & 2135/30.

Longs at 2210/00 can target resistance at 2260/70 for profit-taking (7 points below here yesterday). Shorts need stops above 2280. Strong resistance at 2300/2310. Shorts need stops above 2320.

WTI Crude continues higher through 7720/50 as predicted to resistance at 7840/80 with a high for the day exactly here, in fact. Shorts need stops above 7910. A break higher can target the February high at 7940/70, then 8020/40.

Shorts at 7840/80 can target 7720/00 for profit taking. A low for the morning is possible, but longs need stops below 7670. A break lower targets 7620/00.

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