Having punched through $3,800 yesterday, the gold price surged to hit another record intra-day high of $3,870 overnight. Traders were speculating that $4,000 per ounce was in easy range. But in what now looks like a blow-off top (if only a temporary one), gold suddenly turned lower just after the European session opened for business.
Over the next few hours, gold fell back sharply to break below $3,800. It has managed to stabilise over the last hour or so, just above $3,800, but does look vulnerable to further selling. Despite this, there may be plenty of traders looking at this morning’s price action and considering if it may be an opportunity to buy in at cheaper levels.
Source: TN Trader
While gold could certainly bounce from here, and the shorter-term MACDs have fallen back from overbought levels, the daily MACD has, understandably, barely moved. It could be that gold has further to fall, and there’s little in the way of obvious support between current levels and $3,430 or so. Alternatively, gold could start to churn away around current levels until the MACD resets at lower levels. Time will tell.
