Gold, XAU/USD, Silver, XAG/USD – Technical Outlook:
- Gold continues to flirt with key technical help.
- Silver has consolidated after a good rally this month.
- What is the outlook and what are the important thing ranges to observe for a change in pattern?
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GOLD TECHNICAL FORECAST – BEARISH
The lack of follow-through value motion in spot gold after final week’s break under important horizontal trendline help at 1676 (coinciding with the 200-week transferring common) raises some doubts concerning the reliability of the bearish sign. However, stalling after the break isn’t a sufficienton its personal to conclude that the transfer was a false one – it might properly indicate a lag. While the yellow metallic holds under 1676, the follow-through decline might happen subsequent week or in the end.
For a false break to happen, just like the one in silver just lately (see chart), gold should on the very least rise above the September 15 excessive of 1698 – an out of doors probability highlighted final week. So far that has not occurred even on an intraday foundation. Hence the short-term outlook for gold stays bearish. An increase above 1698 might pave approach in direction of the September 12 excessive of 1735.
From a big-picture perspective, a decisive break (at the least two weekly closes) under 1676 would set off a double high sample (the 2020 and 2022 highs), pointing to a possible fall in direction of the 200-month transferring common (now at about 1292). There is sort of sturdy help at 1620 (the 50% retracement of the 2018-2020 rise), adopted by 1510 (the 61.8% retracement).
XAU/USD & XAG/USD Daily Chart
SILVER TECHNICAL FORECAST – NEUTRAL
Silver’s total impartial bias from final week stays unchanged . As famous then, the multi-month slide has been dropping steamon greater timeframe charts, elevating the prospect of sideway situations within the interim. From just a few weeks’ perspective, 17.50-21.00 is a possible vary, however this week’s sideways value motion that provides an impression of an excellent narrower congestion zone.
After the sharp rally earlier this month, silver has consolidated under key resistance on the psychological and technical 20.00 mark (which incorporates the September 12 excessive). It is vital for silver to interrupt above this resistance if the general restoration construction for the reason that begin of the month has legs. Such a break might open the best way in direction of 21.00 (the August excessive, roughly coinciding with the 200-week transferring common).
On the opposite hand, a decisive break under the September 16 low of 18.76 would point out that this month’s rebound was a dead-cat bounce, elevating the prospect of a retest of the September 1 low of 17.53. Furthermore, a decisive break under 17.53 could be an indication that silver had resumed its medium-term downtrend.
XAG/USD 3-Hour Chart
–— Written by Manish Jaradi, Strategist for DailyFX.com