Gold Price Prediction – Prices Rise but Whipsaw on Dollar Weakness

Gold prices whipsawed and closed higher but well of the session highs after, hitting resistance. The dollar moved lower but settled well off the session lows rebounding during the North American trading session. U.S. yields were mixed, with the 10-year yield rising while the 2-year yield pulled back. A rise in the building confidence helped buoy the long end of the treasury curve, which capped upside momentum in the yellow metal.

Technical analysis

Gold prices whipsawed and closed near the session lows after testing resistance, which is now resistance near the 50-day moving average at 1,778. Support is seen near the September lows at 1,721. Short-term momentum turned positive as the fast stochastic generated a crossover buy signal. Medium-term momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in positive territory but the upward sloping trajectory is decelerating, which points to consolidation.

Builder Confidence Rises

The National Association of Homebuilders reported that builder confidence in the single-family home construction market rose 4 points to 80 in October. That is still down from 85 in October 2020 and from the record high 90 in November of last year. Of the index’s three components, current sales conditions rose 5 points to 87.