Gold analysis – 5 Sep 2019

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By: Ahura Chalki

Raising in the overbought area!

Reuters reported earlier today that China’s Vice Premier Lie He held a phone call with the US Trade Representatives Lighthizer, US Treasury Secretary Mnuchin on Sept 5. And both sides agreed to hold trade talks in early October in Washington. Should we take it as positive news or negative as postponing the September meeting? The gold reaction was to lose the price over $10, from its new high at $1556.94. Stock markets kept their green move more than 1% for Nasdaq and USA500, near to 1% for Dow30 in the USA, Nikkie225 more than2%, Shanghai more than 1.5% (Market Watch) The signs confirm of either lower risk in the market or incuriosity of investors to these developments as it became too used every day and they may decide to do on their own, as they lost the hopes to the governors.

Technical Analysis:

Gold crossed its main key resistance level at $1555, however, could not hold above for a long and lost the position so fast and now again trading under $1545 at the time of writing this note. The next key support sits at $1534 to open the door respectively at $1524, $1517 and $1504. However, since still there is a risk in the market, breaking the $1555 level for next time and holding above, can keep bullish move to $1600. All technical indicators, for now, remain of bearish movement. The MACD histograms forming in the negative area under 0-level, while it’s mainline crossed down the signal line, RSI moves at 50-level with a slope down to 48-level and the Momentum indicator also moves under 100-level. However since the price is still above EMA50, to confirm the downtrend, we need to have it also above Candles.

 

Pivot point: 1548.64

Resistance levels: 1563.50 / 1571.80

Support levels: 1540.34 / 1525.50

The expected trading range for today is between 1525.50 support and 1563.50 resistance.


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