- Instead of trying to reach the monthly R1 at 1,348.36, using the 55-hour as a springboard, the exchange rate stuck at the weekly R1 at 1,339.42 and stayed there until a release of data on the US ISM Non-Manufacturing PMI. The American figures appeared to be positive and dragged the pair down by 0.5%.
- Fortunately for the gold , the 100-hour managed to neutralize the further fall. For this reason, the yellow metal has a good basis to try to get back at least to the above weekly R1.
- On the other hand, there is a need to take into account that below the 100-hour there is an empty zone up until the junior ascending channel’s bottom trend-line and the 200-hour .
As it was expected, most of the previous trading day the yellow metal spent in an advance against the buck.
On the one hand, this movement was triggered by a combined support created by the 55- and 100-hour SMAs. On the other hand, there is also a need to take into account a pressure from the lower trend-line of a rising wedge, which was moving along the above technical indicators.
For this reason, today the pair is expected to make a rebound from the upper trend-line of this long-term formation and, starting from next week, resume the fall towards the monthly R1 at 1,348.36.
However, there is a need to carefully monitor development of the North Korean crisis, as its further escalation might continue to stir interest in the gold.
Check out our trading platform: