August 29, 2024 at 01:09AM
The price of gold has been stepping higher. Adam outlined the ‘Very simple case for buying gold” in his post HERE. And that makes a ton of sense.
However, there are times when the momentum fades and there is a corrective move, or “the case” changes and the market reverses. The technicals help to tell THAT story.
Looking at the hourly chart of the price of gold, there is a ceiling in place. That comes in between $2526 to $2531. That’s a risk-defining level and known as we all can see it. Break above it and I would expect more upside momentum
The price has moved lower over the last 24-hours (away from that MA) and in doing so, the price has moved below the 100 and 200-hour MAs. Those level come between $2507 and $2509. The price is currently below those levels.
The problem is sellers have not been able to keep the momentum going.for long. When there is a start lower, there is a bounce back higher toward the MAs.
Sellers are trying. The ceiling at the highs started the process. The question is can the price of gold now stay below the 100/200 hour MAs? Or not? It’s a trade.
If the price starts to move with more momentum above the 100/200 hour MA, get out. If the price can get below the recent lows and away from the MAs, there is potential to see a move toward $2470 to $2462 area and then see if the momentum can continue.
This article was written by Greg Michalowski at www.forexlive.com.
