Gold Technical Analysis – Eyes on a potential breakout of the range

Fundamental
Overview

Gold finally reached the key
resistance zone around the 2721 level following better than expected US
inflation data and a surprisingly dovish Fed’s Waller last week.

Following those catalysts,
the price kept on going higher as real yields moved lower on a potential top in
the inflation hysteria and the repricing in rate cuts expectations.

Gold
Technical Analysis – Daily Timeframe

On the daily chart, we can
see that gold rallied all the way back to the 2721 resistance where the price got rejected
as the sellers stepped in to position for a drop back into the 2600 support.
The buyers will want to see the price breaking higher to increase the bullish
bets into a new all-time high.

Gold Technical Analysis
– 4 hour Timeframe

On the 4 hour chart, we can
that we have an upward trendline
defining the current bullish momentum on this timeframe. The buyers will likely
lean on the trendline to position for the break above the resistance, while the
sellers will look for a break lower to target a drop into the 2660 level next.

Gold Technical Analysis
– 1 hour Timeframe

On the 1 hour chart, we can
see that we have a counter-trendline defining the current pullback. The sellers
will likely continue to lean on it to keep pushing into new lows, while the
buyers will look for a break higher to position for a rally into new highs. The
red lines define the average daily range for today.

Upcoming
Catalysts

This week is pretty empty on the data front with just a couple of key releases scheduled
for the latter part of the week. Today, we have the Trump’s Inauguration as the
47th US President. On Thursday, we get the latest US Jobless Claims figures,
while on Friday we conclude with the Flash US PMIs.

Watch the video below

This article was written by Giuseppe Dellamotta at www.forexlive.com.