Gold bounced back over $4,000 per ounce this morning, helped by a slight softening in the US dollar. Yesterday it dipped to a near-two-week low. Despite this, there was no retest of $3,950 – a level that it broke at the end of last month. Yet the precious metal continues to trade around lows last seen in November.
Although back then, prices were on their way to all-time highs. This time, gold is on the other side of the peak. The question now is whether gold has pulled back far enough to establish a base from which it can rally. One of the alternatives would be that there is still some downside to retest.
Gold appears, once again, to have found some support just below $4,000 per ounce, and the daily MACD has turned up a touch. But there’s still an air of fragility about it at current levels. And it’s far from clear that support would hold should the dollar perk up again.
Miraculously, today’s CPI update for June came in significantly cooler than expected. The dollar slumped, and gold shot higher, briefly topping $4,100. Nothing has changed from a technical standpoint. But it’s fair to say that bullish gold sentiment has improved.
Source: TN Trader
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