Gold Price Prediction – Prices Slide as the Dollar Rises
Gold prices moved lower on Tuesday, despite a rising dollar. The greenback was able to gain traction as yields surged higher in the wake of strong housing prices. The Fed has signaled that they would begin tapering their bond purchase soon, and recent stronger than expected data has helped buoyed yields.
Technical analysis
Gold prices eased and continued to form a bear flag pattern. This pattern is a continuation event that pauses before it refreshes lower. Prices sliced through trend line support at 1,742. Additional resistance is seen near the 10-day moving average, at 1,758. Target support is seen near the August lows at 1,677. The 10-day moving average has crossed below the 50-day moving average, which means that a short-term downtrend is now in place. Short-term momentum has reversed and turned negative as the fast stochastic generated a crossover sell signal.
Medium-term momentum has turned negative as the MACD (moving average convergence divergence) index generated a crossover signal. This sell signal occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in negative territory with a downward sloping trajectory which points to lower prices.
This article was originally posted on FX Empire
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