Gold Technical Analysis – The stock market bounce set gold free

Fundamental Overview

As the stock markets around the world bottomed (at least for now), the pressure on gold finally waned and the precious metal rallied strongly into a new all-time high.

Gold generally feels the pressure from aggressive stock market selloffs as it tightens financial conditions and there’s a popular narrative that gold positions get liquidated to cover margins.

Not sure about the latter, but as the stock market bottomed, gold finally started to rise again and eventually extended into new all-time highs.

In the bigger picture, gold remains in an uptrend as real yields will likely continue to fall amid fiscal stimuli and rising inflation expectations. The risks include another aggressive stock market selloff and a hawkish Fed.

Gold Technical Analysis – Daily Timeframe

On the daily chart, we can see that Gold rallied into a new all-time high as the pressure from the stock market waned. There’s not much we can glean from this timeframe as we are trading in uncharted territory, so we need to zoom in to see some more details.

Gold Technical Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that the previous all-time high at 3168 could now act as support. That’s where the buyers will likely step in with a defined risk below the level to position for further upside. The sellers, on the other hand, will want to see the price breaking lower to pile in and target a pullback into the 3057 level next.

Gold Technical Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that we also have an upward trendline adding confluence to the support level. Again, the buyers will likely step in there to keep pushing into new highs, while the sellers will look for a break lower to target the 3057 level next. The red lines define the average daily range for today.

Upcoming Catalysts

Today we conclude the week with the US PPI and the University of Michigan Consumer Sentiment survey, but the focus will remain on tariffs negotiations and China.

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