Key Highlights
- Gold price started an upside correction from $1,266 against the US Dollar.
- There is a major bearish trend line forming with resistance near $1,292 on the 4-hours chart of XAU/USD.
- The US Pending Home Sales increased 3.8% in March 2019, more than the 1.1% forecast.
- The Fed Interest Rate Decision is scheduled today (forecast 2.5%, versus 2.5% previous).
Gold Price Technical Analysis
After a strong drop, gold price found support near the $1,265-1,266 area against the US Dollar. The price started an upside correction and settled above the $1,272 resistance level.
The 4-hours chart of XAU/USD indicates that the price formed a decent support base above $1,268 and $1,270. There was a break above the 23.6% Fib retracement level of the last decline from the $1,310 high to $1,266 swing low.
The price tested the $1,288 level, the 100 simple moving average (4-hours), and the 50% Fib retracement level of the last decline from the $1,310 high to $1,266 swing low.
It seems like there are many hurdles on the upside near $1,288, $1,290 and $1,292. There is also a major bearish trend line forming with resistance near $1,292 on the same chart. A successful close above $1,292 is needed for the bulls to gain traction towards $1,300 or $1,305.
Conversely, if the price fails to settle above $1,292 and the 100 SMA, there could be a fresh decline. An initial support is at $1,275, below which the price may test $1,270.
Looking at the major pairs, EUR/USD and GBP/USD started a strong rebound and traded above the 1.1180 and 1.3000 resistance levels respectively.
Economic Releases to Watch Today
- UK Manufacturing PMI for April 2019 – Forecast 55.2, versus 54.5 previous.
- UK Manufacturing PMI for April 2019 – Forecast 55.2, versus 54.5 previous.
- US ISM Manufacturing Index for April 2019 – Forecast 55.0, versus 55.3 previous.
- US ADP Employment Change April 2019 – Forecast 180K, versus 129K previous.
- Fed Interest Rate Decision – Forecast 2.5%, versus 2.5% previous.
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