Gold continues to carry extra rangebound however consumers could also be examined post-Jackson Gap

As talked about because the begin of the week right here, gold continues to maintain in a extra consolidative temper within the huge image. And that continues to be the case up to now few days as nicely. In truth, value is close to unchanged to after I wrote up the linked submit on Monday so go determine. Market gamers are specializing in Jackson Gap this week however should be left wanting until Fed chair Powell gives some decisive feedback in a while, although unlikely.

For gold, that fairly presumably means having to attend on extra catalysts to influence broader market and greenback sentiment earlier than with the ability to react. Because the finish of Could, value motion has been consolidating whilst the basics proceed to remain comparatively supportive. I highlighted these elements within the linked submit above.

The present predicament for gold is that no matter what these elements could argue, the technical aspect of issues is pointing to a stall within the upside momentum. And in reality, we’re nudging in the direction of a key take a look at on the charts with gold consumers already having to place up a protection because the finish of July.

Because the upside momentum stalls and we transfer in the direction of extra sideways value motion, it’s testing the resolve of consumers with the 100-day shifting common (pink line) being known as into query. That degree is seen at round $three,315 presently.

Once more, as one other reminder we’ve not seen gold firmly dip under the important thing degree since October 2023. And that has largely reaffirmed the bullish momentum within the treasured steel since final yr.

As such, a technical break of the important thing degree might set off stops particularly whether it is accompanied by a break of the consolidation vary above amid an extra lack of shopping for urge for food. As talked about earlier this week:

“If there’s a key break there, it might set off technical stops on the way in which down and result in a fast and sharp pullback in costs. The Could lows round $three,120-54 might be a key line within the sand on any main retracement earlier than speaking in regards to the 200-day shifting common (blue line).”

So, therein lies the danger for gold costs no matter how Jackson Gap may pan out. This might be one thing to contemplate particularly if markets should wait two extra weeks earlier than feeding off the subsequent US jobs information to handle the outlook heading into September.

This text was written by Justin Low at investinglive.com.