Gold finds new support

10 paź

Gold slipped lower again yesterday, and has now lost around 3% since hitting its all-time intraday high of $2,685 a fortnight ago. Prices have picked up and stabilised so far this morning. As things stand, there are a few positives that the bulls can take away from the movement over the past two weeks. Firstly, it’s entirely reasonable that gold should pull back from its highs and consolidate. The fact that the current correction has been a gentle downward decline rather than a sharp sell-off (so far) feels constructive. This also looks like a healthy move as it has brought the daily MACD down from recent highs, giving it more upside space. In addition, as mentioned previously, $2,600 didn’t appear to be technically significant to any degree. Instead, it’s just a nice round number that can become entrenched in traders’ psyches. Looking at yesterday's and this morning’s trade, gold has managed to turn higher each time it approached $2,600 from the upside. So, what was purely a psychological area of support is now turning into a technical one. Of course, it’s also one that could be breached at any time. So it’s now a significant marker. Meanwhile, silver is holding over $30. If it can continue to do so, then this should help rebuild bullish confidence across both precious metals.