Gold price continued to decline against the US Dollar, and traded below $1180. More losses are likely as long as the price is below $1200.
Gold Price Weekly Analysis – More Declines Likely As Sentiment Fades
• Gold price extended its decline against the US Dollar, and even settled below the $1180 support.
• The last analysis highlighted bearish trend line on the 4-hours chart of XAUUSD played well in pushing in the price down.
• Today’s US NFP report may impact gold price a lot in the short term, and one must trade with caution.
Gold Price Technical Analysis
Gold price remained in a downtrend against the US Dollar and closed below the $1180 support level. There was a continuous selling pressure, and as a result, the price traded as low as $1161. The last analysis highlighted bearish trend line on the 4-hours chart of XAUUSD acted as a perfect resistance and pushed the price down.
The price is once again recovering, and trading near the 23.6% Fib retracement level of the last decline from the $1231 high to $1161 low.
It may trade back lower or might face sellers near the same trend line resistance. Any major gains could be limited considering the current market sentiment.
Trade Idea – If you are looking to enter a sell trade, then consider it near the trend line resistance with a stop of a close above it or $1288.
Today, the US will witness the release of the nonfarm payrolls by the US Department of Labor. The forecast is 175K in Nov 2016, more than the last 161K. If the result is in the favor of the US Dollar, there can be more declines in Gold price.
Recently, the US saw the Institute for Supply Management (ISM) Manufacturing Index release. It shows business conditions in the US manufacturing sectors and was forecasted to increase from 51.9 to 52.2 in Nov 2016. However, the result was positive, as there was a rise to 53.2, which pushed gold price down.
Overall, there may be more declines in gold price in the short term, and any major rallies could face resistance near $1180-85.