Gold experienced a remarkable surge since early March, forming a series of higher highs to peak at the 13-month high of 2,048. However, bullion quickly retraced lower, falling below the 2,000 mark and trading without a clear direction in the past few daily sessions.
The momentum indicators currently suggest that bullish forces are subsiding but have not surrendered yet. Specifically, the stochastic oscillator is declining after posting a bearish cross, while the MACD histogram fell below its red signal line but remains positive. Nevertheless, the price is currently way beyond the Ichimoku cloud, hinting that the short-term picture has not turned bearish yet.
If bullish pressures fade completely and the price moves to the downside, the February resistance region of 1,959 could serve as initial support. Dipping beneath that zone, gold could descend to challenge 1,933 before the 1,885 hurdle comes under examination. Should that barricade fail, the 2023 low of 1,804 could prove a tough obstacle for the price to overcome.
Alternatively, should buyers regain the upper hand, the 2,000 psychological mark might provide immediate resistance. A violation of that crucial level could pave the way for the 13-month high of 2,048. Failing to stop there, further advances may cease at the March 2022 high of 2,070 registered after Russia’s invasion of Ukraine.
Overall, gold has been trading sideways for the past two weeks, appearing unable to adopt a clear directional impetus. Therefore, a fresh higher high or lower low is needed for this neutral technical picture to alter.
