Golf Bounces Off the 50 Daily SMA
Gold has turned bullish after forming a reversing pattern at the 50 SMA
GOLD reversed down on August 7 from around $2,075, after being bullish for two years, while surging this year due to coronavirus lock-downs, which sent the global economy tumbling and safe havens surging higher. There was a dip in March on the initial panic, but then the price reversed higher and remained like that until August.
But, in August we saw a quick reversal and a crash down of more than $200 in a matter of a few days. That was the first sign that the situation was changing for Gold. After all, the bullish trend had been going on for a long time and every trend needs a refreshing once in a while.
Although, Gold formed a doji candlestick after the pullback, which is a bullish signal and reversed higher. The price moved above the 20 SMA (grey), but pulled back below it and has remained below since then. This moving average has turned into resistance now.
After the bullish reversal pattern above the 50 SMA and the bounce in the last two days, Gold now faces the 20 SMA again. If this moving average holds, then we will head back down for the 50 SMA, otherwise we might see some further upside.
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