Gold arrives at key resistance
Updated
After last week's big drop, gold has bounced strongly in the last few days. But it has now arrived arrived at former support zone between $2645 to $2666. Once support, can this area turn into resistance and lead to another drop? The key downside targets are shown on the chart, with the first bearish target being at $2600.
By Fawad Razaqzada, market analyst with FOREX.com
By Fawad Razaqzada, market analyst with FOREX.com
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Gold and oil rose further as geopolitical tensions remained in the spotlight, while Bitcoin hit fresh records as it closed in on 100K, boosted by optimism that Trump’s election victory victory will mean crypto-friendly policies. In the FX space, the yen was also bid, supported by some hawkish remarks from the BoJ governor, implying a rate hike was not off the table in December. Elsewhere, the EUR/USD broke below the 1.05 handle amid hawkish repricing of US rates and ongoing concerns over Eurozone economy, while the GBP/USD slipped below the 1.26 level to hit its lowest point since mid-May.
With the dollar rising further, gold may still reversal despite recovering more ground than we had expected it would by this stage. That said, it is important we see a clear reversal signal now before potentially looking for bearish setups.
By Fawad Razaqzada, market analyst with FOREX.com
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