Gold’s Price Outlook: Testing Support Levels and Watching for Signs of Potential Reversal

Gold Forecast Video for 29.06.23 by Bruce Powers

Gold triggered a bearish trend continuation today as it fell below the trend low of 1,910. It found support at a low of 1,903 before bouncing. As we head into the end of the session gold is set to close in the top half of the day’s high to low range, and back above the 61.8% Fibonacci retracement level at 1,912. Each sign reflects strength for the short-term.

Might Gold Keep Falling?

Support was seen near the internal uptrend line which has been highlighted in the past as a potential support area. A little lower is the 200-Day EMA long-term trend indicator at 1,896. If today’s low is exceeded to the downside the 200-Day line is the next possible support area and it is significant given its long-term nature. Further, it was tested successfully as support with a double bottom in the first quarter.

Other than the couple of bullish points mentioned in the first paragraph, gold remains bearish short-term and in a clear downtrend. Certainly, as it looks now, it could easily test support of the 200-Day EMA before this correction is over.

Possible Bullish Candle for Wednesday

Assuming today completes with a bullish candlestick pattern, additional signs of strength begin to take hold with a daily close above today’s high of 1,917. However, given the time that gold consolidated around support of the 100-Day EMA on a way down, that price area should provide a more solid pivot to use to indicate that a bullish reversal is more likely to hold and sustain a trend of rising prices.

Key Pivot for Signs of Strength

We will use the first solid test of resistance of the 100-Day line that occurred last Wednesday with a high of 1,940 as a proxy for the prior support shelf. Therefore, a daily close above that price level, also a six-day high, provides a more solid indication that demand for gold is increasing and that the bearish correction is likely over. Following the completion of this week, this week’s high can also be used going forward as a weekly bullish signal would be provided.

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