Gold Price: Surges Past $3,500 – Future Outlook
The question is a good one for the precious metal – It seems that markets are rebalancing flows towards to start this session.
Canadian traders are off for Victoria Day and there is potential for overall less volume overall as this is typically a week that major market players decide to take off in North America, with also the 4th of July on Friday.
These lower volumes haven’t translated to any sign of reversal for the , and this has started to put its weight on Gold Bears – Prices rallied more than $100 in two sessions.
Positive sentiment and lackadaisical pushes to new highs led to more than 5% of correction from war highs, however yesterday’s month-end rebalancing led to some decent buying in the metal – Buyers stepped in at the main daily upwards trendline that propelled the metal to new ATH several times, something to keep an eye on.
Maybe there is something that markets do not know yet, but one thing for sure is that the first day of July is not starting as Risk-On as the flows from last month, letting both Gold and rally.
Before starting the Technical Analysis on Gold, quick reminder to not forget the US at 10:00.
Gold Technical Analysis from Daily to 1H Charts
Gold Daily Chart
Source: TradingView
Bulls really took advantage of the rising daily trendline identified in our last analysis of the precious metal – Also confirming further how important pyschological levels tend to be with prices showing sharp support at $3,250.
Prices just crosses above the 50-Day Moving average which had the potential to send the metal into a more corrective sequence – watch for headlines as markets may be preparing for a lower than expected or more potentially, new tensions in the Middle East after a few attacks on Iranian soil were identified yesterday.
Gold 4H Chart
Source: TradingView
Momentum is very strong, with the rebound on the immediate support zone around $3,250 leading to a Tight Bull Channel, where successive Bull Candles leave no space for sellers to have any control.
The pattern gets invalidated when a selling candle closes below the preceding bull candle – In the meantime, Gold bulls prevented a death cross between the 50 and 200 MA on the 4H Timeframe
Watch for reactions to overbought RSI, a consolidation near the highs is more bullish, and a correction from here would entice a return of some more balance in flows.
Gold 1H Chart
Source: TradingView
Prices broke out decently of the Hourly descending channel formed towards the end of last week, and the 1H Timeframe reconfirms how sellers haven’t had a single chance in this two-session rebound.
There is immediate resistance at $3,360, and way overbought momentum provides some chances for bears to step in.
As long as prices remain above the $3,300 Main Pivot, bulls remain in control
Any break below that pivot and further break below the Daily ascending trendline will give back the hand to the sellers.
Safe Trades!
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