VSheart of the week – Gold (cash)
The sequence of impulsive upward movements of gold (cash) remains intact
Short term technical analysisclick to enlarge the graph
Time stamp: May 8, 2021 at 2:30 p.m. SGT
- In our previous “Chart of the Week” published in the Weekly Newsletter of March 8, gold (cash) rallied and hit the resistance / target of 1,755/65 as expected. Since its low on March 31, 1677, gold has shaped a bullish movement of + 9.9% to print a high of 1,843 on Friday May 7.
- The positive elements remain intact; The 4-hour Relative Strength Index (RSI) has not issued any signals of bearish divergence in its overbought zone. Second, its price action shaped a strong + 5% rise after retesting the old neckline resistance of 1,755 from the mid-term “Double Bottom” bullish reversal pattern on April 29.
- 1 790 short-term key pivot support (also the ascending trendline from the March 31 low) for a further potential push towards the intermediate resistance of 1870 before the risk of minor withdrawal / consolidation sets in. Subsequently, the next resistance to watch will be the significant major zone of 1940/1965 where the bulls were rejected twice on November 9, 2020 and January 6, 2021, leading to a -14% drop to print the recent March low of 1677. A weekly close above 1,965 is likely to signal the start of a potential major uptrend phase.
- In contrast, an hourly close below 1,790 reverses the short-term bullish tone for a retest on the key medium-term support area of 1,765/55.