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TECHNICAL ANALYSIS ON GOLD 07TH OCTOBER 2022

TECHNICAL ANALYSIS ON GOLD 07TH OCTOBER 2022

Gold prices are fluctuating in a small range over $1,700 while attempting to establish a distinct directional bias. In the lead-up to the NFP clash, investors have switched to cautious trading as the US currency hangs onto recent gains and Treasury yields. On the daily sticks, the rally to three-week highs earlier this week that followed the recent consolidation has assumed the appearance of a probable bull pennant. To validate the bullish continuation pattern, buyers require a clear break over the significant barrier at roughly $1,722. The 50 DMA and the resistance of the descending trendline meet at that point. The round number of $1,730 and the September high of $1,735 are the next relevant upside goals. Above $1,735, the way is opened for a new upward trend toward the psychological level of $1,750. The bullish potential of the metal is supported by the 14-day Relative Strength Index (RSI), which is positive above the midline. A daily close below the rising trendline support at $1,707, on the other hand, will invalidate the bull pennant and allow bears to exercise their strength in the direction of the last significant resistance, which is now cushioned at $1,700, before moving toward the weekly low of $1,695. The horizontal 21 DMA at $1,681 will become more visible with further declines, and this will serve as the gold bulls’ line in the sand.