Gold Price Prediction – Prices Continue to Surge on Middle-East TensionsGeopolitics lifts gold prices
Gold prices surged higher on Monday, as geopolitics continued to dominate the landscape. President Trump doubled down on his treats in the mid-east telling Iraq that if US troops were kicked out of the country, following a vote by the Iraqi parliament. Loosing a stronghold in Iraq, that they US built would create additional chaos in the region. Markit reported final December Eurozone PMI services which were stronger than expected helping to buoy the Euro and pave the way for higher gold prices.
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Gold prices surged breaking through the September highs at 1,556, and hitting 1,586, before closing off the highs of the day. The weekly charts on gold prices have broke out. Target resistance is now seen near the October 2012 highs at 1,795. Short term support is seen near the September highs at 1,556 and then the 10-day moving average at 1,507. The 10-day moving average recently crossed above the 50-day moving average which shows that a short term up trend is now in place. The daily RSI (relative strength index) is now printing a reading of 85, rising from 82 which reflects accelerating positive momentum. This nearly equals the high print on the RSI of 87 in 2019. The RSI is above the overbought trigger level of 70, and also points to a potential future correction.
Weekly momentum is positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This occurs as the MACD line (the 12-week moving average minus the 26-week moving average) crosses above the MACD signal line (the 9-week moving average of the MACD line).
Markit reported its final December eurozone services and composite PMI readings came in higher than expected. The headline on the services was 52.9 and 50.9, on the composite. Germany improved significantly from the flash reading. Germany also reported strong November retail sales, up 2.1% month over month versus. 1.0% expected.