Gold Hovers Near Three-Month Highs as Dollar Shows Some Fatigue

The political concerns in the global economy and worries over U.S. President Trump’s administration turned the traders to the old classic safe-haven asset for their portfolios, the gold. The yellow metal, over the last seven weeks, lifted sharply to the upside after the significant bounce off the $1,122 support barrier. It’s worth mentioning, that the XAU/USD pair added gains more than 7% since January. The bullish move continues and the gold price climbed above the 38.2% Fibonacci retracement level of the downward significant move between the high at $1,375 on July 6[SUP]th[/SUP], 2016, until the low at $1,122 on December 15[SUP]th[/SUP], 2016.

Early on Thursday morning, the pair approached the 50.0% fibo level which overlaps with the 200-weekly SMA. If the price surpasses above the two stated obstacles, it would be exposed towards the 61.8% strong fibo level near the $1,278 resistance handle. Despite that, the precious metal needs to challenge the 200-SMA on the daily chart, as it is moving below the aforementioned level. Otherwise, if the metal slips below $1,240, will hit again the $1,220 support level. The MACD oscillator surged above its trigger line and is moving with strong momentum while the RSI indicator entered the overbought area after the rebound on the 50 level.


JFD Research