The price of gold has seen a notable decrease, with a Troy ounce now valued at $2029.00 on the global commodity market. This decline is primarily attributed to the strengthening of the US dollar, which has surged following positive labor market reports from the US on Friday. These reports underscored a robust employment sector, potentially fueling inflationary pressures, which in turn has influenced gold prices. Gold typically exhibits an inverse correlation with the US dollar, making this dynamic a key factor in its current valuation.
Investor sentiment towards gold has been cautious, as evidenced by data from the Commodity Futures Trading Commission (CFTC). There has been a consistent reduction in long positions on gold for four consecutive weeks, signaling growing apprehension among investors regarding the precious metal's future prospects.
Gold (XAU/USD) Technical Analysis
The H4 chart analysis of XAU/USD indicates an ongoing downward trend towards $2019.00. Upon reaching this level, a potential corrective move to $2042.42 could unfold. Following this correction, a further decline to $2000.55 is anticipated, marking a local target. The MACD indicator supports this bearish outlook, with its signal line positioned below zero and pointing downward.
Similarly, the H1 chart shows the formation of a decline towards $2019.00, identified as the initial target. Should this target be met, a corrective phase towards $2042.42 may occur before the trend continues its downward trajectory. This technical perspective is corroborated by the Stochastic oscillator, currently below 20 but expected to ascend towards 80, indicating potential short-term corrective movements within an overall bearish trend.
By RoboForex Analytical Department
Disclaimer: Any forecasts contained herein are based on the author's particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.
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Gold Prices Retreat Amid Strong US Dollar Rally
Published 02/05/2024, 07:17 AM
Updated 02/15/2024, 03:13 AM
Gold Prices Retreat Amid Strong US Dollar Rally
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