Gold: potential for slowdown
Ongoing geopolitical issues and also forthcoming elections in the US, are making investors to increase demand for safe-haven assets. The price of gold continues to benefit from these uncertainties, by continuing to hold at historically highest levels, and keep the score of 32% increase for the year. During the previous week, the price of gold modestly slowed down till the level of $2.710, however, it swiftly turned back to the up-course.
The RSI continues to hold at overbought levels, moving above the level of 70 for the last two weeks. In technical analysis, this is clear indication of high potential for a short term reversal, however, considering current unstable geopolitics, there is also some probability that the reversal might be postponed. For many weeks, moving averages of 50 and 200 days are moving as two parallel lines with an uptrend, without any indication of a potential cross in the coming period.
Technical indicators are pointing to the potential of a short reversal. However, this should be taken with precaution at the current moment. Aside from geopolitical issues that strongly impact the price of gold, for the week ahead, it should be considered US macro data which are set to be published. The PCE data and non-farm payrolls might bring back volatility on the markets. Still, at this moment, some stronger reversal should not be expected. Charts are indicating the level of $2,7K which might be tested, but there is no potential for lower grounds.
The RSI continues to hold at overbought levels, moving above the level of 70 for the last two weeks. In technical analysis, this is clear indication of high potential for a short term reversal, however, considering current unstable geopolitics, there is also some probability that the reversal might be postponed. For many weeks, moving averages of 50 and 200 days are moving as two parallel lines with an uptrend, without any indication of a potential cross in the coming period.
Technical indicators are pointing to the potential of a short reversal. However, this should be taken with precaution at the current moment. Aside from geopolitical issues that strongly impact the price of gold, for the week ahead, it should be considered US macro data which are set to be published. The PCE data and non-farm payrolls might bring back volatility on the markets. Still, at this moment, some stronger reversal should not be expected. Charts are indicating the level of $2,7K which might be tested, but there is no potential for lower grounds.
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