Gold prices have surged around $10 in the short term, approaching a two-week high. FXStreet analysts: technical indicators support continued upward movement
On Tuesday (November 21) in early Asian trading, spot gold suddenly rose sharply by about $10 in the short term. Gold prices just broke through $1988/ounce, refreshing two-day highs. The nearly two-week high resistance hit last Friday was around $1993.31/ounce. FXStreet analyst Matías Salord recently wrote an analysis of the technical outlook for gold.
Salord pointed out that the dollar continued to fall, with the dollar index falling to its lowest level since August. Gold experienced a bearish correction on Monday, falling to $1965 an ounce at one point, but then rebounded.
The dollar index fell to a more than two-month low on Monday, extending last week's losses as investors widely believed the Federal Reserve had completed its rate-hiking cycle and looked forward to when it would start cutting rates.
The ICE Dollar Index, which tracks the greenback against six major currencies, fell 0.45 per cent to 103.45 on Monday before falling further to 103.40 in early Asian trading on Tuesday.
Salord said that gold prices remain above the 20-day moving average, and risks remain tilted to the upside in the short term.
On Tuesday, the Federal Reserve will release its latest meeting notes. Market expectations that the Federal Reserve has ended raising interest rates will affect the dollar in the short term and keep gold upside risk.
Gold's short-term technical outlook
Salord said that from the daily chart of gold, the price of gold rebounded and returned to above the 20-day simple moving average (SMA) of $1975/ounce. To gain further momentum, the price of gold needs to close above $1975/ounce. On the other hand, if there is a consolidation and the daily closing price is below $1960/ounce, it indicates that the price of gold may continue to correct.
Salord added that looking at the four-hour chart of gold, and looking at the four-hour chart, technical indicators support gold prices to continue to rise.After the gold price broke through the key resistance of $1981/ounce, the focus will shift to $1987/ounce and then $1992/ounce.
(4-Hour chart of spot gold)
Salord gives the latest key support and resistance levels for gold prices:
Support levels: $1963/oz; $1954/oz; $1944/oz
Resistance: 1992 USD/oz; 2001 USD/oz
At 09:18 Beijing time, spot gold was quoted at $1986.33 per ounce.
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