GOLD: Losing its shine, but why?
Hi Traders and welcome back to EverythingFX. I'm writing to you from cloudy London and I just thought I would shed some light on why Gold has been falling against the Dollar and currently trading at $1269.47 per ounce.
Looking at the monthly timeframe we can see price formed a strong bearish reversal after spiking into the highs at our resistance of $1350.00. Dropping down to a weekly timeframe we can see price has been trending to the downside creating significant lower-swing-highs with a nice re-test of our psychological level of $1300 before pushing lower.
Dropping down to a 4-hour timeframe we can see price pushed itself straight into a liquidy region where can see price previously found support and resistance on several occasions. Where do I see this heading next you may be wondering? As traders, we want to try and sell from the highest possible point so I will be looking for a retest of previous support now resistance as highlighted in the screenshot above. The overall downside target for this pair is our level of support at $1250 which provides us with a good 220 PIPs upon a re-test of the highlighted region.
Fundamentally we had new home sales for March coming in at 4.5% versus consensus of -3.0%. With large firms and corporations changing their stance on earnings there is still a 56% chance of a rate cut later this year but economists believe it could be dropping as the year progresses and a trade deal is made with China. Stay tuned to our market news section and twitter feed for updates....