Gold Price Technical Outlook: XAU / USD Weekly Trade Levels
Gold price snapped a four-week winning steak in June open trade with XAU / USD down more than 0.8% after reversing a key technical confluence area. While the broader outlook remains tilted upward, progress may still be vulnerable in the short term while remaining below this key threshold. TIt is the updated targets and invalidation levels that rely on the Weekly gold charts on the heels of today’s US non-farm payroll (NFP) publication. See again my last Weekis lying Strategy webinar for an in-depth analysis of this technical gold configuration and more.
Gold Price Chart – XAU / USD Weekly
Graphic prepared by Michel Boutros, technical strategist; Gold on Tradingview
Notes: Last month Weekly Gold PriceOutlook we noted that the XAU / USD rally “remains constructive above 1840 – look to reduce long exposures / increase protective stops on a test of confluent technical resistance at 1909/23. “The price hit a high this week at 1916 before reversing lower – was that the magnitude of the pullback?
Initial weekly Support is based on the 52-week moving average / annual reversal of the week high closing at 1846/49 with wider bullish invalidation now raised to the high of 2012 at 1795– an area of interest for possible downward exhaustion IF reached. Ultimately a breach to the upside / close above 2011 high / 61.8% Fibonacci retracement to 1923 is necessary to mark the resumption of the wider uptrend with such a scenario exposing the rresistance targets at the highest annual 2021 to 1959 and the close of the high week of 2020 at 2034.
At the end of the line : A rally of over 13% over several months brings gold prices into a confluence of critical resistance and leaves bulls vulnerable below 1923. From a business perspective, a good area to reduce long exposures / increase protective stops – look for downside exhaustion of 1795 IF, price is indeed heading higher with a breach exposing annual highs. Review my last Gold PRice Prospects for a closer look at near-term XAU / USD technical trading levels.
For a full description of Michael’s trading strategy, see his Fundamentals of Technical Analysis Series on Bbuild a Tranking Sstrategy
Gold Trader Sentiment – XAU / USD Price Chart
- A summary of Sentiment of IG customers shows that traders are long on gold – the ratio is +4.00 (80.01% of traders are long) – usually bearishreading
- Long positions are0.13% more than yesterday and 4.21% more than last week
- Short positions are22.69% less than yesterday and 24.36% less than last week
- We generally take a contrarian view of crowd sentiment, and the fact that traders are net long suggests that gold prices may continue to decline. Traders are longer than yesterday and last week, and the combination of current positioning and recent changes gives us a stronger bearish countercurrent trading bias in gold from a feeling point of view.
Previous weekly technical charts
– Written by Michel Boutros, Currency strategist with DailyFX
To pursue MIchael on Twitter @MBForex