GOLD Accelerates Its Sell-Off!

Gold has decreased in the short term after it was rejected by a very strong dynamic resistance. It is traded at near the $1,700 psychological level, the current drop it was somehow expected after the last amazing rally.

The gold price has decreased also because the USD has managed to increase on the USDX’s rally. You should know that Gold maintains a bullish outlook despite the minor drop, the COVID-19 consequences and effects could lead the price towards fresh new highs, we could use the correction to go long again.

The gold price has found strong resistance at the upper median line (uml) of the ascending pitchfork, I’ve said in my previous analysis that the price could reach it after the aggressive breakout above the inside sliding line (sl).

Gold has ignored the $1,700 psychological level, the R1 ($1,702) level and the $1,703 previous high, but now it has come back to test the broken obstacles, that’s why I’ve said in the previous days that you should wait for a valid breakout above these levels before you go long.

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Gold is still bullish as long as it is traded above the inside sliding line (sl) and above the median line (ml) of the dark blue ascending pitchfork. The median line (ml) represents critical dynamic support, a valid breakdown below it could signal that the upside movement is finished and that a corrective phase could come.

We could have a great opportunity to buy gold again if the price will register only a false breakdown below the $1,700 psychological level and if it stays above the sliding parallel line (sl), the first target remains at the upper median line (uml) and the second one is seen at the $1,800 psychological level.

A selling opportunity could appear after the price will drop and stabilize below the $1,600 psychological level, so you should still look for long opportunities as the price is traded far above this level.

Personally, I would like to see a consolidation above the $1,700 level and above the weekly R1 ($1,702) level to be certain that Gold will resume the upside movement and it will reach fresh new highs.

The material has been provided by InstaForex Company – www.instaforex.com

Source:: GOLD Accelerates Its Sell-Off!