GOLD PRICE TECHNICAL ANALYSIS AND FUNDAMENTAL OVERVIEW REPORT – 24 MARCH 2023
24 Mar 2023
The price of gold rises above $1,990 as global yields decline
Gold’s price has gained bullish momentum and soared above $1,990 after falling toward $1,980. The standard 10-year US Treasury bond yield is down more than 3% on the day, hovering around 3.3% as investors seek safety after a surge in credit default swaps from Deutsche Bank.
The price of XAU/USD has re-broken above $2,000 after dip-buying in the $1,960 area on Thursday started a new leg upward for the precious metal. A lower US dollar and declining Treasury yields aided gold’s upward trend. The movement of the metal may be determined by the announcement of durable goods orders and PMI data later Friday.
Before recovering, the US dollar drops to a new monthly low.
Without a dominant theme driving price activity, markets continue to function. On the daily chart, the Dollar Index (DXY) has formed a bullish hammer candlestick, suggesting a reversal from March’s severe loss. The index has recovered from fresh monthly lows hit on Thursday in the 101.90 range. But it’s still too early to say without a solid confirmation day that’s encouraging. However, if the US Dollar does begin to reverse higher, it will be detrimental to XAU/USD.
Central banks expand their gold holdings
According to recent research by the French bank Société Générale, central banks in non-Western regions of the world are “de-Dollarising” owing to geopolitical polarisation and diversifying into Gold instead.
“Countries that are not allied with the West will be more willing to distance themselves from the USD as long as the Russia-Ukraine conflict continues. According to the research, this will motivate central banks to keep up their substantial gold purchases. The central banks of non-aligned nations ought to maintain de-dollarizing their holdings and investing in gold (6% of our allocation, unchanged), which will eventually be underpinned by lower real yields, continues Soc Gen.
GOLD TECHNICAL ANALYSIS DAILY CHART:
The next move up to the next resistance cap at Monday’s $2,009 highs, where a convergence of technical levels provides a tight ceiling, would be confirmed with a break over Thursday’s high of $2,003, which would aid. The true turning point that would energise bulls to push the upswing to new heights would be a clear breach and closing above $2,010.
Gold is currently trading in up channel.
Gold is currently trading above all SMA.
RSI is in buying zone which suggests bullishness and Stochastic is suggesting up trend.
Gold resistance is at 1992.64 & its immediate support level is 1981.82
HOW TO TRADE GOLD
Gold is trading in up channel, currently, it is at the resistance zone if the zone is broken, we can see further upside to the second resistance.