Home Forex Markets Analysis of gold price trend: 1700-1680 constitutes a “safety pad”, but the road to gold price rebound is extremely difficult

Analysis of gold price trend: 1700-1680 constitutes a “safety pad”, but the road to gold price rebound is extremely difficult

by WOOWinvest
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Analysis of gold price trend: 1700-1680 constitutes a “safety pad”, but the road to gold price rebound is extremely difficult


The strong dollar suppresses the trend of gold prices, and gold is also sold off as an asset, and there are no strong factors in sight for the time being. 1700-1680, as a key support area for 2 years, may trigger technical buying, and the effect is expected to be limited.

The strong dollar supported by the Fed’s interest rate hike expectations constitutes a strong pressure on gold. According to the non-agricultural and inflation data in June, the possibility of the Fed raising interest rates by 75 basis points in this month’s interest rate decision is more than 90%, but the possibility of raising interest rates by 100 basis points cannot be ruled out. .

Under such strong tightening expectations, gold is treated as an asset, and the stock market continues to be under pressure. Gold’s status is even more embarrassing. In addition to being a non-interest-bearing asset, its safe-haven attributes have also been deprived. This has led to a gloomy outlook for gold. It is expected that the overall trend of gold prices will continue to decline until the economic recession and the Russian-Ukrainian military conflict show more serious signs.

On the chart trend, $1700-1680 has been the key support area since June 2020. Pay attention to the performance of this area. It is very likely that gold will stop falling here, but the road to rebound is extremely difficult.

After falling below the $1,800 mark, multiple trend lines above show strong resistance, but they are far from the current price, which reflects that there is room for a rebound after the price is oversold, and the key resistance is above $1,780. After rebounding back to the resistance, if the breakthrough cannot be completed, it is still a good time for the bears to intervene.

At present, the price of gold is running between 1700-1750 US dollars, and it should be regarded as a shock until it breaks through. If it breaks below 1700, it will test $1680, and 1680 may also provide support, but if it falls below it, it will open a large-scale trend down, and the market outlook will look between $1600-1500. If it can break through 1750, it is expected to test 1780-1800, then pay attention to the resistance strength of 1800, and wait for an opportunity to continue to hold short positions. The market outlook effectively breaks through 1830 and then pays attention to the development of the reverse upward trend.

(Arthur)

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