Gold Price Prediction – Prices Consolidate and Form Weekly Doji Day

Gold prices continued to ease on Friday, closing nearly unchanged for the week and forming a doji week. This move came as the dollar continued to slide and US yields moved lower. The downward movement in the dollar was unable to buoy gold prices for the week. New home sales rebounded more than expected but failed to buoy yields.

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Technical analysis

Gold prices moved lower on Friday and closed unchanged for the week forming a doji day which is a sign of indecision. The upward trend remains in place as prices head for resistance near a Fibonacci retracement level of 38.2%, which is seen near 1,828. Target resistance on the yellow metal is seen near the February highs at 1,855. Support is seen near the 10-day moving average at 1,766. The 10-day moving average has crossed above the 50-day moving average which means that a short-term up trend is now in place. Short-term momentum reversed and turned negative as the fast stochastic generated a crossover sell signal. The current reading on the fast stochastic is 83, above the overbought trigger level of 80. Medium-term momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. The MACD histogram is printing in positive territory with a declining trajectory which points to consolidation.

U.S. Home Sales Rebound

New U.S. single-family homes rebounded more than expected in March. The Commerce Department reported that new home sales surged 20.7% to an annual rate of 1.021 million units last month. Expectations forecast new home sales, which account for a small share of U.S. home sales, increasing to a rate of 886,000 units in March.