Gold Retraces Back Down as Sentiment Improves
Gold surged higher due to coronavirus fears, but it has retraced back down today and leaned on the 20 SMA
The sentiment improved in financial markets in the last couple of weeks, after panic set in during late January due to coronavirus. But yesterday, the sentiment turned negative again as coronavirus cases increased in Italy, sparking fears of a pandemic in Europe.
As a result, risk assets such as stock markets tumbled lower, while safe havens such as GOLD and the JPY rallied higher. In fact, it was a bloodbath in stock markets yesterday, which continue to decline today again. But, it seems like the sentiment is not as bad as yesterday.
Gold has retreated down, after surging during the last couple of weeks. The price declined from around $1,690 to $1,635, but it ran into the 20 SMA (grey) on the H4 chart. This moving average provided support for Gold earlier today and we see that Gold has bounced off of it.
The previous candlestick closed as a hammer which is a reversing signal, while the retrace down is complete. So, this looks like a good opportunity to go long on Gold. The coronavirus is not under control and it’s still spreading, so the sentiment will remain negative for days at least, if not weeks. We are evaluating the situation now and might go long soon.
- Check out our free forex signals
- Follow the top economic events on FX Leaders economic calendar
- Trade better, discover more Forex Trading Strategies
- Open a FREE Trading Account
Related Articles
Comments
Sidebar rates
Related Posts
Save
Join 350 000+ traders receiving Free Trading Signals
Alerts
Rates
Calendar
Signals