Gold price traded sharply lower against the US dollar in yesterday’s trading despite the Fed increasing money supply and risk aversion dominating sentiment. XAUUSD finished at $1,576.74 after opening at $1,634.63.
This is both interesting and worrisome mainly because gold is considered as a safe haven asset. It means that in times of panic or turmoil, gold price tends to go higher. Investors seek the precious metal’s safety because they see that, unlike paper money, it has intrinsic value. What worries analysts is that the sell-off in gold could be because the recent drop in equities has made investors desperate for cash; they’re liquidating their positions on gold.
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Gold Price Outlook
On the daily time frame, we can see a double top formation on gold price. This is characterized by a market getting rejected at a resistance level twice. For XAUUSD that price was $1,689.15. As of this writing, gold price looks to be trading below the neckline support. If sellers can maintain their momentum, we could see XAUUSD fall further on the charts. It could drop to the area around $1,512.75 where it previously found resistance.
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Gold Price Outlook
On the daily time frame, we can see a double top formation on gold price. This is characterized by a market getting rejected at a resistance level twice. For XAUUSD that price was $1,689.15. As of this writing, gold price looks to be trading below the neckline support. If sellers can maintain their momentum, we could see XAUUSD fall further on the charts. It could drop to the area around $1,512.75 where it previously found resistance.On the other hand, if sellers run out of steam, we could see a pullback in gold price. The hourly chart shows that XAUUSD has room to trade higher and still maintain its downtrend. By connecting the highs of March 9 and March 11, we can see that there is trend line resistance around $1,640.25. This price also coincides with the 100 SMA and 200 SMA.More content
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