As gold continues to work through this corrective phase, market analysts will be looking to see what gold does next. The yellow metal’s downside objectives lie on the same near-term targets of 4,422 and 4,404 USD. On the downside, we might experience a more significant retracement to the 4,360 USD level. Gold has been surprisingly strong, even in the face of very strong US growth numbers. That leaves its long-term direction in doubt.
The recent action in gold suggests that it is in the throes of a significant bear market. The market is experiencing another bearish impulse, especially aiming the 4,422 USD level. This movement is in agreement with the MACD (Moving Average Convergence Divergence) indicator’s signals. Currently, this bodes poorly for a bullish short-term scenario. The signal line for the MACD is still in positive territory, but is beginning to move downwards. This trend signposts that downside pressure on the asset is here to stay.
Alongside the MACD’s bearish signal, the Stochastic oscillator is signaling continued selling pressure on gold. The signal line is also below 50 and trending toward 20. This trend further fuels the perception that intense selling pressure is overwhelming the market. Gold prices recede Analysts are expecting lower gold prices to stick around. They have lowered their targets down to 4,432 USD and eventually to 4,404 USD.
Today’s gold market environment is not friendly to gold investors. Those who are able to weather this volatility will discover fruitful opportunities. Considering this, a corrective rebound toward the key psychological level of 4,474 USD is expected after profit-taking from the recent sell-offs. This recent rebound creates a unique buying opportunity for investors. If you are a long-term gold bull, we think this is an exciting time, one of the best-ever macroeconomic backdrops to be investing in gold.
Market participants have their fingers on the proverbial pulse, but underwater. Do not ignore the possible drop to 4,360 USD. It would signal that the current bullish run is continuing long. Investors should continue to keep a close eye on gold as it continues to move with the market and the larger economic indicators and sentiment.