Gold Recovered After Plunging This Spring

Gold prices recovered early in the summer after plummeting in April and May. On Monday June 3rd, the instrument is trading at 1315.10 USD. We can see a slight correction, but there are enough reasons for a further growth.
Dmitriy Gurkovskiy
Closeup of big gold nugget

Right now, the fundamental background is in favor of bulls. In general, there is only one reason for this, the trade conflict between the USA and China. To get things even more complicated, the USA decided to have trade wars on two fronts and hardened its relations with Mexico. Nobody denies that the USA are very aggressive and protect only their own interests. Investors don’t like it and try to avoid risks. At the same time, the demand for “safe haven” assets is going up. In this case, Gold stood to gain from this panic.

Obviously, trade wars between two global giants, Washington and Beijing, aren’t going to end today or tomorrow. Things are getting more serious and complicated as both parties are now placing restrictions on rare earth metals exports and laying charges of espionage. Probably, diplomatic means for agreeing on trade relations aren’t working anymore.

In this light, Gold has a potential to grow and may continue trading upwards for a while.

In the H4 chart, XAUUSD is trading below 1290.00. The instrument has reached its downside target at 1266.00; right now, it is forming a new correction. After breaking the correctional channel, the price may start another decline. From the technical point of view, this scenario is confirmed by Stochastic Oscillator; so far, its signal line indicates that the correction may yet continue, but may later be followed by the downtrend with the target at 1260.00.


The H1 chart shows the correction as well. Possibly, the pair may fall towards 1277.00. However, there is another scenario, according to which the correction may yet continue to reach 1290.00. After breaking the correctional channel, the price may resume the downtrend with the target at 1260.00. From the technical point of view, this scenario is confirmed by MACD Oscillator, as its signal line is reversing away from the “overbought area”. After breaking 1275.00, the downtrend may quicken.


By Dmitriy Gurkovskiy, Chief Analyst at RoboForex


Any predictions contained herein are based on the authors’ particular opinion. This analysis shall not be treated as trading advice. RoboForex shall not be held liable for the results of the trades arising from relying upon trading recommendations and reviews contained herein.

Don't miss a thing!

Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All

Top Promotions

Top Brokers

The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.