Gold Forex Technical Analysis for June 22, 2016
Forex Technical Analysis – Gold markets fell rather significantly during the course of the day on Tuesday, but having said that the market looks as if it is still consolidating with a bit of an upward bias to it. Short-term charts could offer selling opportunities, but quite frankly we feel that it’s much easier to buy supportive candles or bounces off of daily charts in order to take advantage of what has been a general grind higher. Keep in mind that grinding markets tend to be rather slow, and as a result it takes quite a bit of patience in order to profit.
In Other View Ppoint – Gold headed back towards 50-DMA support
Rising global equity markets continues to dent demand for safe-haven assets, with Gold prices consolidating around two-week lows, near $1265 level.
The precious metal extended its reversal from a multi-month high level of $1315 touched last week and touched a 10-day low level of $1261 during Asian trading session on Wednesday as receding Brexit fears continued supporting global risk-on rally.
Adding to its, a sudden spurt of buying interest surrounding the greenback exerted additional downside pressure for dollar-denominated commodities – like gold, on Tuesday, despite of any hawkish comments from the Fed Chair Janet Yellen’s testimony.
With a relatively lighter economic calendar, the bullion might continue to derive momentum from the broader risk sentiment surrounding global financial markets.
Technical levels to watch
From current levels, the metal seems to continue sliding before finding support around 50-day SMA near $1253-50 region. A follow through selling pressure has the potential to drag the yellow metal further towards 100-day SMA support around $1242-40 region. A decisive break below 100-day SMA now seems to negate any near-term bullish expectations, thus opening room for further near-term depreciating move.
On the flip side, any recovery attempts might now confront immediate resistance around a support break-point near $1275-77 area. Momentum above this immediate resistance seems to get extended towards $1290-92 horizotnal resistance, above which the metal seems all set to resume its bullish momentum and head back towards reclaiming $1300 psychological mark.