Long term trend: bearish
Intermediate term trend: bearish
Short term trend: bullish
Very short term trend: bearish
Gold found support at 1216 last week after a short and shallow correction and has rallied back up to the resistance zone at 1244-1246 this week at the 200 week MA.
The gold price is currently in a choppy sideways pattern bounded by 1216 at the bottom and 1244 at the top. Any move below 1215 should see an acceleration to the downside, with 1180 the first target and any breakout above 1245 will see a move towards 1262 in the first instance.
Gold remains above the 20 and 50 day moving averages but below the key 200 day moving average, currently at 1261, and until gold can break the long term down trend line, last tested after the US election result and unbroken for 6 years, we remain bearish for gold in the intermediate and long term timeframes. This line is currently at approximately 1312 and moving slowly lower.
We are in a seasonally strong period for gold and the chart looks eerily similar to last year. We would therefore expect a top to be put in place between now and mid-March.
Equities continue to power higher, with the Dow now well above 20,700 and the S&P above 2,350. This would usually be bearish for gold, though the uncertainty around Donald Trump’s presidency is keeping interest in the yellow metal strong.
Oil remains in an uptrend, having rebounded strongly from the 2016 lows below $30 a barrel and is now trading above $54 a barrel.
Support can be found at 1231, 1226, 1216-1222, 1207, 1198, 1180, 1172, 1160, 1145, 1122, 1100, 1072 and 1045. The late 2016 sell off and rejection of the long term down trend line is bearish for gold in the long term timeframe and suggests a move towards the 2016 lows is likely, unless gold can break above the 2011 down trend line.
Resistance can be found at 1244-1246, 1262, 1280, 1300 and 1317. Gold needs to break the key resistance level at 1317 to give the bulls some momentum and long term control.