XAUUSD Gold Forecast and Technical Overview
We have published our midterm/longterm forecast last week. We keep our bullish bias midterm. In the short-term, what could be the direction?
A positive sign: Gold prices do not drop as DXY testing the highs. This is showing us that the demand for Gold is significantly stronger.
Trade Wars: There is concern that the current trade war between the US and China is no closer to a resolution than in past weeks. In fact, with the deadline quickly approaching in which the United States will ratchet up both the percentage of tariffs, as well as the items being taxed, genuine concern has moved to a new higher level. Positive for Gold – Safe Haven Approach –
The US Shutdown: There is also a major concern about the upcoming deadline on February 15th, in which there is a possibility that another government shutdown could occur if Congress fails to pass legislation. Some traders believe that would be a bullish effect on the Gold Prices. However, historically, we did not see any strong and sharp movements during the government shutdown. Neutral
Short term Bearish Risk: The risk in the short-term is how the Fed will digest the news that the U.S. economy is staying pretty resilient and the unemployment rate is pretty low while there are challenges given the global economic backdrop and the equity market wobble that we saw last year. The market is unsure how the Fed will reconcile its new dovish tone with strong macroeconomic data coming out of the U.S.
For gold to really rally, the dollar prices need to be weaker. It really needs to be even weaker for gold to really take-off.
A new trading range is developing and gold might get stuck in a sideways action next week. Looking at the matter technically; Gold prices are likely to be in a sideways pattern going into next week. It wouldn’t be surprising if we have a newly defined range between $1,306-$1,330. That’s the next consolidation phase…
On the H4 Chart, XAUUSD completed a bullish flag pattern. I was expecting Gold to test 1.318 – 1.320 after the breakout. However, the price rejected $ 1.316 and ended the week at 1.314. It may retest the broken flag at 1.310.
1.318, 1.320, 1325 and 1.328 will be the next targets of XAUUSD, as long as the price holds above $ 1.312.
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DISCLAIMER: This is a technical analysis study, not advice or recommendation to invest money
XAUUSD Gold: Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these securities. You should do your own thorough research before making any investment decisions. Chartreaderpro does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Forex involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility