Gold Technical Analysis: Anticipating a Return to $1900

Mahmoud Abdallah

Any decline in the price of gold is an opportunity to buy again.

Advertisement
Is now YOUR time to trade gold ?
Don't let fear prevent profits!

Trade Gold Now!

By the end of last week’s trading, the price of gold had collapsed to the support level of $1828 from the resistance level of $1918 in the same trading session, the largest percentage loss in one day in two months. For a short period, at the beginning of the second week of trading in 2021, the downward pressure continued, as it retreated to the support level of $1817 an ounce, its lowest in more than a month. The retreat was an opportunity for gold investors to return to buying again, as the price of gold now stabilized around the level of $1860 per ounce as of this writing. The decline in Treasury yields and the decline in stock markets amid fears of an increase in COVID-19 cases helped the price of gold rise again. In the same performance, silver futures closed at $25.284 an ounce, while copper futures contracts settled at $3.5645 a pound.

What affected investor and market sentiment was the increase in coronavirus cases in many countries around the world. In Germany, Chancellor Angela Merkel warned the local population that "the coming winter weeks will be the most difficult stage of the epidemic." Concerns about developments in Washington also weighed on stocks as Democrats prepare for another attempt to remove President Donald Trump from office, with eight days left in office.

Democrats expressed horror and indignation after Trump supporters besieged the Capitol building last week, despite their having encouraged waves of violent riots by mobs for the better part of last year. The Democrats are blaming Trump for inciting the Capitol riots because he suggested that the presidential election was rigged, despite the fact that he pleaded with his supporters to be peaceful and return home. Twitter shares fell 6.4% for one of the biggest losses in the S&P 500 after it banned Trump from and his 89 million followers. Twitter cited "the risk of further incitement to violence", though the platform publish incendiary calls for violence by such people as Iran's Ayatollah. The move has sparked a lot of anger from conservatives who might abandon the service and demand more regulatory scrutiny of the company. Facebook's stock slipped 4% after the site also suspended Trump's accounts.

Technical analysis of gold:

Any decline in the price of gold is an opportunity to buy again, with the support levels of 1840, 1825 and 1800 the most important for gold investors to consider buying. As for the bulls' control, it will not return without breaching the psychological resistance level of $1900. 

Gold Daily Chart

Mahmoud Abdallah
Mahmoud has been working fulltime in the Foreign Exchange markets for 12 years. Offers his analysis, articles and recommendations at the most renewed Arabic websites specialized in the global financial markets, and his experience gained a lot of interest among Arab traders. Works on providing technical analysis, market news, free signals and more with follow up for at least 12 hours a day, and aims to simplify forex trading and the concept of trading for his audience.

Did you like what you read? Let us know what you think!

exclamation mark

Please make sure your comments are appropriate and that they do not promote services or products, political parties, campaign material or ballot propositions. Comments that contain abusive, vulgar, offensive, threatening or harassing language, or personal attacks of any kind will be deleted. Comments including inappropriate will also be removed.

0 User comments

exclamation mark

Please make sure your comments are appropriate and that they do not promote services or products, political parties, campaign material or ballot propositions. Comments that contain abusive, vulgar, offensive, threatening or harassing language, or personal attacks of any kind will be deleted. Comments including inappropriate will also be removed.

Read more
Add new comment
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.