Gold price fell but is this a buying opportunity ?

HL-TradingFX Updated   
OANDA:XAUUSD   Gold Spot / U.S. Dollar
Gold prices stood at $1,927, increasing by $6 compared to the previous week's closing. The precious metal experienced its strongest percentage decline in four months. Gold is facing downward pressure due to a stronger USD and the cautious stance of US Federal Reserve officials, with no signs of recovery yet.

Kitco's gold survey this week shows a decrease in optimism among Wall Street analysts and retail investors. This may pose challenges for the precious metal in the coming week. Some analysts believe that with the market's downward trend, gold testing support levels around $1,900 is only a matter of time.
⭐️Make a trading plan:
✅Sell ​​the $1,940-$1,937 range when the price hits the resistance area.
✖️Stoploss: $1,945.

"The only thing we decided was not to raise rates at the June meeting," Powell said during a panel in Sintra, Portugal. "I wouldn't take moving at consecutive meetings off the table at all."
From a technical standpoint, further selling below the $1,900 mark could trigger a price decline for Gold. The daily chart indicators are currently in negative territory, and it may take some time before they reach oversold levels. In that case, Gold prices could quickly drop to the $1,876-$1,875 range.

On the other hand, any positive move above the $1,912-$1,913 range or the current Asian session high could face resistance near the $1,924-$1,925 area before reaching $1,936. A sustained upward momentum could lead to a short-term rally towards the barrier at $1,962-$1,964, on the way to the supply zone at $1,970-$1,972.
On the inflation front, the PCE price index was relatively unchanged, rising 4.1%, compared to the previous estimate of 4.2%. Core PCE, which strips out volatile food and energy prices, was a tick lower than expected, rising 4.9%, compared to consensus forecasts of 5.0%.
From a technical standpoint, the round number $1,900 is currently acting as immediate support, with overnight lows fluctuating around $1,893-$1,892. Further selling activity could confirm negative prospects and potentially push Gold prices down towards the challenging level of $1,840.

On the other hand, any positive move above the $1,913 level or an overnight high could face resistance near the $1,924-$1,925 range, before reaching the $1,936 area. Sustained strength above that could trigger a short-term rally towards the $1,962-$1,964 barrier, on the way to the supply zone of $1,970-$1,972.
Friday, the U.S. Department of Commerce said its core Personal Consumption Expenditures price index increased 0.3% last month, compared to April's increase of 0.4%. The inflation rose in line with economists' expectations.

Meanwhile, inflation in the last 12 months rose 4.6%, down a tick from April's 4.7% increase. Annual inflation was slightly cooler than expected as economists forecasted an unchanged reading. However, looking at the broader trend, inflation remains stubbornly high, more than double the Federal Reserve's target of 2%.
Retail trader data shows that 73.17% of traders are currently buying gold, with a long to short ratio of 2.73 to 1. The number of traders buying gold is 4.30% lower than yesterday and 2.28% lower than last week. On the other hand, the number of traders selling gold is 3.67% higher than yesterday and 4.74% higher than last week.

While most traders are buying gold, our contrarian view suggests that gold prices may continue to decline. However, it's worth noting that the number of traders buying gold has decreased compared to yesterday and last week. This change in sentiment indicates that the current downward trend in gold prices may soon reverse, despite the fact that traders are still mostly buying gold.

Related Ideas


The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.