Jump to content

Gold Price Forecast: Gold Bears Threaten Bigger Break After 2k Reversal


Recommended Posts


Gold Price Forecast: Gold Bears Threaten Bigger Break After 2k Reversal

Gold prices have went from feast to famine in a week. Just last Monday buyers were in-charge in a big way, pushing up for another test of the $2,000/oz psychological level that’s become somewhat of a stumbling block for Gold bulls of recent.

Just after that hit, the flow changed on Gold as sellers started to take a stand. Prices then cut through all nearby supports on the way to brewing a bearish engulfing candlestick on the weekly chart. This put the focus back on the bearish side of Gold and given the massive spot of support that remained, there was a fairly clear objective for sellers to clear on the chart.

This zone runs from the psychological level of 1900 up to the prior all-time-high at 1923.7, and for the past two months this area has been functioning as support in Gold.


gold monthly price chart

Chart prepared by James Stanley; Gold on Tradingview

From the weekly chart below, we can see that recently completed bearish engulf, going along with this morning’s quick test below the 1900 level. If bears can continue to push, deeper support potential exists around prior price action swings of 1879 and 1842. If sellers can push for a longer-term reversal deeper into Q2, and a major level sits at 1784 which was a batch of support in Gold around the New Year open.


gold weekly price chart

Chart prepared by James Stanley; Gold on Tradingview


The week has started fast as Gold prices have fallen by as much 2% already after last week’s candle closed as a bearish engulf; and as of this writing the US equity market hasn’t even opened for business yet. So this could be a difficult move to chase lower, but there is scope for bearish continuation as taken from the four-hour chart.

As taken from prior support structure, there’s a swing at 1918 that remains attractive for lower-high resistance potential. For those that are very aggressive, there’s another spot that’s close around 1908, which hasn’t been as consistent as support in the past although this did remain an important pivot around candles that had previously tested below the 1900 level. That can be looked at as an ‘r1’ for bearish scenarios.

And for traders that don’t want to look for a pullback, breakout logic also exists, targeting deeper support around 1879. To learn more about approaching and working with breakouts, the guide below will offer additional information on that market condition.


gold four hour price chart

Chart prepared by James Stanley; Gold on Tradingview

--- Written by James Stanley, Senior Strategist for DailyFX.com

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • General Statistics

    • Total Topics
    • Total Posts
    • Total Members
    • Most Online
      10/06/21 10:53

    Newest Member
    Joined 29/01/23 11:39
  • Posts

    • Does anybody know the BIL (SPDR Bloomberg 1-3 Month T-Bill ETF) equivalent with a GBP currency hedge? I want the interest yield but I don't want the currency risk.
    • Capital, win loss ratio. If you have a trading edge and you can consistently win 50% of your trades, so your winning 5 trades out of 10. So if your risking 1% of your capital per trade, out of your 10 trades 5 would be losers, so that’s 5% loss and realistically out of the 5 winning trades, some would make small profits, some break even and 1, 2 or 3 could run nicely IF you can let your profits run, basically your making money out of 2 trades out of the 10 trades (80/20 Rule Pareto principle) So a $20,000 acct risking 1% is $200 per trade, this will keep the trader with his trade risk based on being able to win 50% of his trades. A long term trend trader can win with 30% wining trade. Basically you need to know your numbers. Rgds Pete
    • Investing in stocks can be a great way to grow your wealth over time. However, there are different approaches that investors can take when choosing which stocks to buy. Two of the most popular approaches are growth investing and value investing. Growth Investing Growth investing is an investment strategy that focuses on buying stocks of companies that are expected to grow at a faster rate than the overall market. These companies are often in industries that are growing quickly, such as technology or healthcare. Investors who use this approach believe that these companies will be able to generate higher profits in the future, which will lead to higher stock prices. One of the main advantages of growth investing is that it can potentially provide higher returns than the overall market. However, it is also riskier than other investment strategies, as these companies often have higher valuations and more volatile stock prices. Value Investing Value investing is an investment strategy that focuses on buying stocks of companies that are undervalued by the market. These companies may be in industries that are out of favour or have recently experienced challenges, but they have strong fundamentals and a history of profitability. Investors who use this approach believe that these companies are undervalued and that their true value will be recognized in the future, leading to higher stock prices. One of the main advantages of value investing is that it can potentially provide lower risk than growth investing. However, it may also provide lower returns in the long run, as these companies may not have the same growth potential as companies in the growth investing category. Comparing Growth and Value Investing Growth and value investing are two different approaches to stock investing, each with its own advantages and disadvantages. Growth investing can potentially provide higher returns but is riskier, while value investing can provide lower risk but potentially lower returns. An investor may choose one approach or a combination of both. A portfolio that contains a mix of growth and value stocks can provide a balance of potential returns and risk. Conclusion Both growth investing and value investing can be effective ways to invest in stocks. The key is to understand the potential risks and rewards of each approach and to choose the one that aligns with your investment goals and risk tolerance. Analyst Peter Mathers TradingLounge™ 
  • Create New...