⚡Crypto Alert : Altcoins are up 28% in just last month! Unlock gains and start trading now - Click Here

Gold Price Prediction: Descending Triangle Pattern Breakout, Going After $1,699?

Gold Price Prediction: Descending Triangle Pattern Breakout, Going After $1,699?

Posted Tuesday, March 30, 2021 by
Arslan Butt • 2 min read

Good morning, traders.

The precious metal GOLD prices closed at 1711.81 after placing a high of 1732.84 and a low of 1705.65. On Monday, the yellow metal prices reversed their direction and dropped to their lowest since March 12 after moving sideways throughout the previous week as the traders were trying to clear out the direction for gold amid rising US dollar and Treasury yields. The treasury yields on the 10-year note remained near 1.7%, and the US Dollar Index approached the 93 levels on Monday that raised fresh pressure on the yellow metal. Along with the safe haven metal, many other commodities and the main indexes at Wall Street were also down, like Dow Jones, S&P 500, and NASDAQ.

The reason behind the rising US dollar and treasury yields was optimism around a quick economic recovery as the vaccination campaigns have gained momentum. Meanwhile, inflation concerns were also raised due to the US government’s massive stimulus package that supported the treasury yields. The greenback’s safe-haven appeal was also elevated by the concerns about a potential effect of a default hedge fund on margin calls.

On Monday, a massive sale in the stock market, including some of the US tech companies after the losses at Archegos Capital Management, also raised the US dollar and weighed further on the prices of gold. Furthermore, on Monday, US President Joe Biden said that 90% of American adults would be eligible for coronavirus vaccines by April 19, and the sites of vaccinations will be available within five miles of an individual’s home. Biden’s new timeline was nearly two weeks earlier from his previous May 1 goal for nationwide eligibility. He added that the remaining 10% of the population would be eligible by the time. Biden also announced that a record 33 million vaccine doses would be distributed this week by the US’s federal government. This improved the optimism associated with the economic recovery and supported the US dollar that added further losses in the precious metal.Additionally, the Fed Governor Christopher Waller said that the central bank was not keeping monetary policy easy to support the government to run up debts and deficits. Waller defended the Fed’s independence from the authorities in Congress and rejected the notion that the central bank was holding the borrowing cost low to help service the debt, or that asset purchases were being conducted to finance the debt-laden federal government.

This all came in after Fed critics emphasized that the central bank was keeping rates lower so that the government can continue borrowing. So, Waller stressed the importance of the Fed’s independence from Congress and refused the notion that monetary policy was set to keep borrowing costs lower. These comments from Waller also helped the US dollar and added losses in gold prices.

Gold Price Prediction: Descending Triangle Pattern Breakout, Going After $1,699?

Daily Technical Levels
Support Resistance
1699.46 1728.76
1686.73 1745.33
1670.16 1758.06
Pivot point: 1716.03

The precious metal GOLD is trading sharply bearish at 1,707 level, having formed a bearish engulfing candle on the 4-hourly timeframes. On the lower side, it can go after 1,699 area to target. At the same time, an immediate resistance stays at 1,714 level. The MACD and RSI are in support of a selling bias today. Let’s capture a quick sell position below 1,714 level until 1,699 level today. Good luck!

Check out our free forex signals
Follow the top economic events on FX Leaders economic calendar
Trade better, discover more Forex Trading Strategies
Related Articles
Comments
0 0 votes
Article Rating
Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments