Gold: results and forecasts
Summing up the expectations for gold in March “Gold. Expectations for March 2019,” we can say that the expectations were fully met. In fact, gold showed a rapid decline in value in early March. The signal for a reversal was the breaking through of the ascending multi-month channel.
Expectations for a decline in gold are preserved, while they were complemented by the expectation of a correction against six-month growth. The signal for the correction will be the formation of a reversal, the formation of which is expected to range from 1320.00 to 13330.00.
We should also note a very rapid decline and such a rapid correction after it. Despite meeting expectations and updating lows at levels: 1302-00.00 and 1290.00, there is a rapid correction. The correction eventually limited the longer decline in gold.
The current situation for gold
In the first half of April 2019, the price of gold returned above the psychological mark of 1300.00. As a result, the upward trend is formed on gold, which will be limited by the resistance of 1310.00, the upper limit of the monthly downward channel.
The driver for the strengthening of gold in early April was the rise in general risks and the weakness of the American currency. Analyzing the risks more detailed, it is worth noting the sluggish progress in the US – China trade talks, which, despite the obvious work in this direction, have practically yielded no actual results. It is also worth highlighting the exacerbation of political risks in the United States, which acted as a catalyst for the growth of risks and the flight of investors from risks.
The current market situation is likely to continue to support gold to resistance levels of 1310.00 and 1320.00.
Expectations for gold for the end of April
On the H4 timeframe, gold continues to form a “double bottom” pattern, which in the longer term will indicate long-term growth. To do this, the gold price will need to overcome the monthly descending channel and resistance levels: 1310.00 and 1320.00.
On the daily timeframe (D1) the situation is contradictory. Analyzing the chart on a large timeframe, gold continues to move in the correction phase, forming a reversal in the form of a “head and shoulders” pattern, which was continued in the form of lengthening the second shoulder. This development of the movement model implies the preservation of the monthly downward channel, the formation of a reversal in the range of 1300.00-1310.00 and a decrease to the zone of 1290.00-1280.00 (neck level).
Risk factors continue to be political uncertainty in the United States, putting the pressure on the American dollar, and the geopolitical situation around the US – Chins trade negotiations, and the United States and the eurozone.
Anton Hanzenko