Technical Analysis – Gold’s advances tackle 100-MA and Ichimoku cloud

Anthony Charalambous, XM Investment Research Desk

Gold’s latest climb is simultaneously confronting the curbing Ichimoku cloud and the 100-period simple moving average (SMA) around 1,844. The Ichimoku lines are reflecting a pause in positive momentum, while the relatively horizontal SMAs are promoting a sideways market.

The short-term oscillators suggest sentiment remains positively skewed. The MACD, in the positive region, is slightly above its red trigger line, while the RSI is persisting in bullish territory. Furthermore, the stochastic oscillator has shifted to positive, endorsing more price gains.

If buyers manage to overcome the capping cloud and the 100-period SMA at 1,844, early resistance could occur at the nearby high of 1,849. Another push over the latter obstacle may form the necessary confidence for the commodity to test the 200-period SMA at 1,862. In the event the price overshoots the 200-period SMA, buyers may face a significant resistance boundary of 1,869-1,876. Should golds’ shine attract more buying interest, it could then target the 1,900 hurdle.

Otherwise, if the price retreats from the cloud and 100-period SMA, quick support could come from the red Tenkan-sen line at 1,838 and the 50-period SMA at 1,835 ahead of the key 1,829 low. If sellers then steer the price further south, gold may meet the 1,819 barrier and the adjacent blue Kijun-sen line at 1,816. Fading from here could drive the bears to examine the 1,808 trough.

Summarizing, gold remains fairly neutral in the short-term. A push above the 1,849 high or below the 1,829 low could establish the next price action. However, a break above 1,876 or below 1,785 would be required to cement a more profound move.