Gold Keeps Failing at the 100 SMA, as the Range Narrows
Gold has been trading in a tight range for 2 weeks and the range looks good to trade
GOLD used to be very bullish during Q2 as the global economy weakened further and safe havens received strong bids as a result. But, the sentiment improved in September and safe havens have retreated lower. Although, sellers are not running away with it and safe havens have traded sideways during October, which shows that there is still uncertainty in the markets.
Gold has traded in a range during this month, which used to be wider at first, but got narrower as the month progressed. Last week, the range was defined by the 100 SMA (red) at the top and the 200 SMA (purple) at the bottom. The range was around $20 wide.
But, it became narrower this week as traders wait to see what will happen with Brexit. The 100 SMA remains as resistance for Gold, while at the bottom, the previous support level at $1,482 is doing its job again. Yesterday the price climbed higher to the 100 SMA, but failed to break that moving average once again and now the price is reversing back down.
This range looks pretty good to trade, especially selling at the top where the 100 SMA is, with a stop above it. We missed that chance yesterday and now the price is at the middle of the range, so we will wait for Gold to reach one of the extremes of this range in order to buy or sell.
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