Gold Technical Price Outlook: XAU/USD Near-term Trade Levels
Gold prices surged more than 13% off the monthly lows with last week’s breakout stalling into the close of March trade. While the broader outlook remains weighted to the topside, the advance remains vulnerable into the April open and we’re looking to a reaction off support for guidance. These are the updated targets and invalidation levels that matter on the XAU/USD technical charts. Review my latest Weekly Strategy Webinar for an in-depth breakdown of this gold trade setup and more.
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Gold Price Chart – XAU/USD Daily
Chart Prepared by Michael Boutros, Technical Strategist; Gold on Tradingview
Technical Outlook: In my last Gold Price Outlook we noted key support, “at 1547/52 with a breach higher from here exposing subsequent resistance objectives at 1649.” XAU/USD registered a high at the 76.4% retracement at 1643 last week before settling with price continuing to range just above the March open / 61.8% retracement at 1585– now key near-term support. Broader bullish invalidation remains steady at 1547/52 with a topside breach exposing subsequent resistance objectives at the high-day close at 1678.
Gold Price Chart – XAU/USD 120min
Notes: A closer look at Gold price action sees XAU/USD breaching above descending pitchfork resistance with subsequent breakout failing to offer any follow-through. Price is now riding former slope resistance as support. Key lateral levels eyed at 1585 backed by1569– a break there would risk a larger decline with such a scenario eyeing subsequent support objectives eyed at 1547/52 and the yearly open at 1520. Weekly open resistance stands at 1617 with a breach above 1643 needed to fuel the next leg higher towards the high-day close at 1678– look for a larger reaction there IF reached.
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Bottom line: The gold price breakout has stalled here and while the broader outlook remains weighted to the topside, the immediate recovery may be vulnerable while below last week’s high. From at trading standpoint, look for downside exhaustion / possible long-entries while above the monthly open but ultimately a larger pullback may offer more favorable entries with a breach of the highs needed to keep long-bias viable. Keep in mind we’re heading into the close of the month / quarter – use caution heading into the April opening-range. Review my latest Gold Weekly Price Outlook for a closer look at the longer-term XAU/USD technical trading levels.
For a complete breakdown of Michael’s trading strategy, review his Foundations of Technical Analysis series on Building a Trading Strategy
Gold Trader Sentiment – XAU/USD Price Chart
- A summary of IG Client Sentiment shows traders are net-long Gold- the ratio stands at +2.73 (73.22% of traders are long) – bearishreading
- Long positions are2.29% lower than yesterday and 12.95% lower from last week
- Short positions are 15.39% higher than yesterday and 23.59% higher from last week
- We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests Gold prices may continue to fall. Yet traders are less net-long than yesterday and compared with last week. Recent changes in sentiment warn that the current Gold price trend may soon reverse higher despite the fact traders remain net-long.
| Change in | Longs | Shorts | OI |
| Daily | -2% | 12% | 2% |
| Weekly | 0% | 29% | 6% |
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– Written by Michael Boutros, Technical Strategist with DailyFX
Follow Michael on Twitter @MBForex