Gold Daily Analysis – August 24, 2017

Gold prices settled higher on Wednesday after President Donald Trump made a statement that he would shut down the government which raised concerns over fears political uncertainty in Washington.

However, Traders were careful of taking large positions ahead of speeches by European Central Bank president Mario Draghi and Federal Reserve chair Janet Yellen at a two-day central banking symposium in Jackson Hole, Wyoming.

Technical Outlook

Short Term View

Gold prices moved slightly higher yesterday to trade at $1296 which is a selling point.  The market has formed “Head and shoulder Chart pattern” and the current trend may reverse towards $1272-1283 region. According to this pattern, it is more likely that prices will be under selling pressure. A break below $1290 will keep the pattern active and a break above $1299 will cancel this pattern.

Long-term View

Gold prices were trading around $1300 but couldn’t sustain around this area and finally closed lower. This indicates a Triple top reversal pattern which usually leads to downside pressure.

On the Gold 4H chart, prices have formed “Ascending broadening wedge” and continue to rally further on the same direction according to the pattern. It has rebounded towards upper resistance trend line at $1300 which will be a triple top and struggling place. A break above and close of a daily candle will lead towards $1318-1362.

On the other hand, if prices could not break above $1300, a downfall can be expected and the next target will be around $1280. Additional long-term support is on the 100-day moving average at $1256.