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Gold Price Analysis: Bears seek 5 wave correction to 61.8% Fib retracement

The price of gold has been climbing in five waves on the monthly charts and could be on the verge of a correction. However, considering the geopolitical environment as well as the risks of a global pandemic of the Coronavirus, it could be prudent holding off at this juncture from positioning any shorts. Instead, it may be a higher conviction trade to look for a bullish entry point maked by the opening gap. Failures there opens an opportunity to get long down in the 61.8% Fibonacci retracement of the monthly impulse from the 1460s.

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Gold kick-starts the week with bullish gap-up to $1589

Gold prices remain positive while taking rounds to $1,583, following the intra-day high of $1588.70 flashed at the week’s start, amid Monday’s Asian trading session. The yellow metal recently benefited from fears of China’s coronavirus outbreak while worries headlines from the Middle East as well as concerning the global trade add to the risk aversion.

As per the latest update, the coronavirus death toll rises to at least 80 from 56 communicated earlier. The fatal virus has so far affected more than 2,000 people in China as per the official statements whereas unofficial claims rise to as high as 90,000 being infected. Outside China, the US registered fifth case whereas Sydney and Japan are also in the list of affected.

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