- Gold bulls step in from near key support zone
- RSI and MACD suggest momentum is turning positive
- Advances within the current sideways range may be possible
- A dip below 2,290 could invite the bears back into the game
Gold is trading higher today, after hitting support slightly above 2,290 on Wednesday. That zone has been acting as a strong support barrier since April, and it can also be seen as the lower boundary of a sideways range that’s been containing most of the price action since then. This paints a neutral medium-term outlook but in the shorter picture, the metal may continue drifting north within the aforementioned range.
Taking a look at the short-term oscillators, the RSI has just poked its nose above its 50 line, while the MACD, although negative, has bottomed and crossed above its trigger line. Both indicators are suggesting that the momentum may have started shifting positive.
If the bulls are willing to stay in the driver’s seat and push the action above 2,340, then they could aim for the 2,370 zone, or the 2,388 barrier, which is the upper bound of the aforementioned sideways range. For the outlook to turn bullish though, a break higher may be needed. This could set the stage for extensions towards the record high of 2,450, hit on May 20.
On the downside, a dip below 2,290 could carry large bearish implications, perhaps paving the way towards the 2,195 zone, marked by the inside swing high of March 27. However, that could still not constitute a trend reversal in bigger timeframes. For that to start being examined, a dip below 2,145 may be needed.
To recap, gold has been trading within a sideways range since April, and lately it has rebounded from near the lower bound, which means that some further short-term advances may be in the works.
