Last week we focused on silver, where we highlighted the possibility of a further upswing and today at night, we made new higher highs. Today we will focus on gold, where the sentiment is also positive but when we look at the Silver/Gold ratio, we see that AG is much stronger lately than AU.
Worth mentioning is the fact, that after the gold made local lows in the middle of December and started the upswing, they treated every Fibonacci line with a great respect. Both 23,6 and 38,2% played an important role as supports and resistances. What is more, after the bearish bounce from the area around 50% Fibo (blue), we are now testing the 38,2% as a support again. So far, the first contact is optimistic for buyers as the H4 candlestick looks like a hammer, and the long tail is showing us that the lower prices were quickly used to buy gold with occasional prices.
Even if the 38,3% will be broken, that will not deny the bullish sentiment. It stays positive, as long as the price stays above the red up trendline. Interestingly, the latest demand for gold can be generally seen as very high, especially when we consider much stronger USD and new upswings on the indexes – both events being usually a negative influencers on the price of the XAU/USD.
