Technical Analysis

GOLD Price Analysis – Dec 13, 2023

By LonghornFX Technical Analysis
Dec 13, 20233 min

Daily Price Outlook

action, it continues to receive support from geopolitical tensions and the anticipated change in Fed policy in 2024. The uncertainty surrounding when the US might decrease interest rates is putting pressure on the dollar, which is favorable for gold. Traders are awaiting the Fed's decision, closely examining their statements and projections.

There is speculation that the Fed might lean towards lowering rates in 2024, potentially leading to a decline in the dollar and a boost for gold. Recent US data, revealing unexpected price increases, adds further uncertainty to the equation. Investors are eagerly awaiting clues from the Fed regarding future interest rates, impacting both the dollar and gold.

China's Supportive Policies and Geopolitical Tensions: Impact on Investor Sentiment

Furthermore, the anticipation of additional support from China's policymakers is outweighing concerns about escalating tensions in the Middle East, maintaining a positive sentiment for riskier investments. Reports from China's recent economic conference suggest they're planning adjustments to support recovery in 2024.

Meanwhile, Yemen's Houthi rebels, backed by Iran, are setting rules for navigating the Red Sea due to Israel's embargo, including restrictions near "Occupied Palestinian territories."

Surprisingly, this doesn't dampen investors' interest in riskier assets or weaken the overall positive market sentiment, benefiting assets like precious metals that are considered safe havens.

GOLD Price Chart – Source: Tradingview
GOLD Price Chart – Source: Tradingview

GOLD (XAU/USD) - Technical Analysis

As of December 13th, Gold is experiencing a nuanced shift in its market dynamics. Currently trading at $1,978, it registers a slight decrease of 0.07%. The precious metal is navigating through a complex technical landscape, marked by a mix of bearish and neutral signals.

In the realm of key price levels, the pivot point for Gold stands at $1,896. It faces immediate resistance at $1,948, with further barriers set at $2,049 and $2,103. Should bearish pressures intensify, support may be found at $1,798, followed by $1,694 and $1,594. These levels delineate the crucial thresholds that could determine Gold's short-term direction.

The technical indicators paint a detailed picture. The Relative Strength Index (RSI) stands at 31, signaling that Gold is nearing oversold territory, but still shy of the critical 30 mark. Meanwhile, the Moving Average Convergence Divergence (MACD) shows a value of -0.418, with its signal line at -12.414, hinting at a potential bearish sentiment in the near term.

The 50-Day Exponential Moving Average (EMA) is placed at $1,983, slightly above the current price, suggesting a potential short-term bearish trend. However, the recent formation of Doji and spinning top candles just above the $1,980 mark indicates a state of indecision among traders, particularly in anticipation of the upcoming FOMC meeting and the Federal Reserve's interest rate decision.

In conclusion, while Gold's trend remains predominantly bullish above the $1,980 level, the current market indicators and upcoming economic events suggest a cautious approach. Traders and investors are likely to focus closely on the outcomes of the FOMC meeting and the Federal Reserve’s rate decision, which could significantly impact Gold's price movement in the short term.

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