Technical Analysis

GOLD Price Analysis – Nov 24, 2023

By LonghornFX Technical Analysis
Nov 24, 20233 min

Daily Price Outlook

Gold (XAU/USD) continued its upward rally, registering modest gains on Thursday, supported by a weakened US Dollar. However, it has not yet surpassed the significant $2,000 psychological mark. Gold prices are currently fluctuating within a narrow trading range. However, the reason behind this upward momentum can be traced to dovish expectations surrounding the Federal Reserve. However, the anticipation of a more accommodative monetary policy from the Fed continues to lend support to gold, a non-yielding yellow metal.

Fed's Hawkish Tone and Economic Resilience Create Mixed Signals for Gold and USD

Despite the Federal Reserve adopting a hawkish tone in the minutes released on Tuesday, investors are leaning towards the belief that the central bank will stick to steady interest rates instead of opting for an increase. This stance is curbing the recovery of the US Dollar this week and contributing to gains in the price of gold.

On the flip side, the release of US economic data on Wednesday showcased strength in the job market, introducing some uncertainty about the Federal Reserve's future plans. This, combined with an increase in US Treasury bond yields, is giving a boost to the US Dollar and limiting the upward movement of gold. Despite this, gold is still set for its second straight weekly gain as traders eagerly await the release of flash US PMIs, which could have a notable impact on the market on the final day of the week.

Gold Price Uncertainty Amidst Fed's Hawkish Stance and Market Rate Cut Expectations

On Friday in Asia, gold doesn't know where to go. People who trade are uncertain because the Federal Reserve wants to keep interest rates high to control prices, but others think they might lower rates in 2024. This confusion is making traders hesitant about what to do with gold.

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

GOLD (XAU/USD) - Technical Analysis

As of November 24, Gold exhibits a modest uptick, with its price marginally increasing by 0.03% to $1992. This slight rise positions the precious metal just below the pivotal $2005 mark. Looking ahead, Gold encounters immediate resistance at $2030, followed by higher thresholds at $2068 and $2100. Conversely, support levels are established at $1970, $1945, and $1907, providing potential cushions against downward movements.

The Relative Strength Index (RSI) for Gold stands at 55, indicating a mildly bullish sentiment without showing signs of overextension into overbought territory. Meanwhile, the Moving Average Convergence Divergence (MACD) displays a value of -1.3 with a signal line at 3.56, suggesting mixed signals. While the negative MACD hints at potential bearish momentum, the price of Gold hovers around its 50-Day Exponential Moving Average (EMA) of $1993, supporting a short-term bullish outlook.

Chart analysis reveals an upward channel pattern, endorsing a buying trend for Gold. This pattern indicates sustained bullish momentum, reinforcing the metal's upward trajectory.

In conclusion, the overall trend for Gold remains bullish, particularly if it sustains above the crucial $1985 mark. In the short term, Gold is anticipated to challenge the immediate resistance at $2030. Should it breach this level, further resistance tests at $2068 and $2100 could be on the horizon. Investors and traders should closely monitor these key levels and indicators, as they will likely influence Gold’s price movements in the coming days.

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