Gold’s rally stalls at technical resistance after 3% rise
Gold’s rally stalls at technical resistance after gaining more than 3%.
FUNDAMENTAL OVERVIEW:
- Gold prices rise on safe-haven demand after reports that Israel is considering strikes on Iran’s nuclear facilities.
- Meanwhile, President Trump faces opposition from Republican lawmakers over his fiscal package in Congress.
- With a breakout from its tight range, gold may see further upside momentum.
Gold (XAU/USD) is edging higher on Wednesday, approaching $3,310 at the time of writing, amid growing fears that tensions in the Middle East could escalate once again, coupled with uncertainty over the passage of Trump’s fiscal bill in Congress. Late Tuesday, CNN reported that Israel is contemplating strikes on Iran’s nuclear facilities. While former US President Joe Biden managed to sway Israeli Prime Minister Benjamin Netanyahu’s stance, current President Donald Trump’s diplomatic efforts appear to be unravelling, leaving markets to question whether Trump still holds influence over Netanyahu.
Meanwhile, in the US, President Trump is encountering domestic hurdles as his administration struggles to secure enough support in Congress to pass its tax reform bill. Frustration mounted for Trump on Capitol Hill during talks with lawmakers, who are pushing to substantially increase the cap on the state and local tax (SALT) deduction.
GOLD TECHNICAL ANALYSIS DAILY CHART:
Technical Overview:
Gold is trading within an up channel.
Gold is moving above all the Moving Averages (SMA).
The Relative Strength Index (RSI) is in the Buying Zone, while the Stochastic oscillator suggests a Neutral trend.
Immediate Resistance level: 3320.00
Immediate support level: 3235.35
HOW TO TRADE GOLD
Gold initially experienced a sharp ascent on the higher time frame before reversing to a significant support level. This support held, prompting an upward reaction in price. Subsequently, Gold decisively broke through its critical resistance with strong bullish momentum, continuing its upward trajectory. Currently, after this substantial rally, Gold is undergoing a pullback, correcting downwards towards its immediate support zone. If this zone is respected and Gold remains above it, it is likely to continue trading higher.