Gold bulls defending 50% Fibo level line in the sand, bears looking to 61.8% Fibo target

• Gold prices are moving sideways and consolidating the recent run to fresh swing highs in the recovery of the August 2018 rally.  
• Gold is currently trading at 1325 from within the day’s range of $1,323/oz and $1,330/oz as Fed Powell’s 2.5hr first-day of testimony draws to a close.

There was no reaction to Powell’s opening statement and conclusion, repeating that the Fed is patient although the debt ceiling was something that Powell was warning of when he said that the fiscal path was unsustainable – something that markets will now likely focus on.

The dollar, for now, however, has been soft at the margin, sliding in recent trade between the range of 96.46 and 96.15, currently trading at the lows. Gold, however, has been confined to a chop between the $1,323 and $1,330 range.  

“Gold failed to hold above key levels yesterday, which has seen the latest round of buying come to a halt, although buying would resume if gold can rally above 1,336/oz. But, should US economic data remain firm in the coming weeks we anticipate gold will continue to drift lower for now,”

analysts at TD Securities argued.  

Gold levels

Within the monthly uptrend, bulls are targetting the horizontal  resistance line in the 1370s, although were capped well short of the mark by the descending trend-line resistance at recent YTD high of 1346. For the near term, technically, the price  remains in no man’s land between the 50% and 23.6% Fibo retracements of the recent swing high and last Thursday’s sell-off low. Indeed, indicators remain neutral. However, on repeated upside failures, risk is to the 61.8% Fibo of the same move at 1319 with the confluence of the 13th Feb spike fractal high.   The price is just about holding above the 50% Fibo retracement of the 14th Feb swing lows to recent double top highs which leaves gold in neutral territory.