Gold Price Tops $1,800 With Conviction – More Gains Ahead?

Gold and silver prices have put in a strong session so far today as precious metals look to extend their rebounds with conviction. Gold price action popped 1.7% and eclipsed a major technical resistance level around $1,800/oz. Silver, which tends to be more sensitive and volatile than its yellow-metal cousin, jumped 3.5% to trade at its highest level in ten weeks. This follows the bullish cue I pointed out last week on the back of dovish Fed policy guidance. More recently, FOMC officials have continued to voice adamantly how the central bank will look through transitory rises in inflation and keep benchmark interest rates near zero for the foreseeable future.


Gold Price Chart Forecast

Chart by @RichDvorakFX created using TradingView

At the same time, real yields have tumbled lower, which looks to be driving the bid beneath precious metals like gold and silver. In fact, the ten-year real yield on US Treasuries has plummeted to -0.88% from -0.56% in mid-March. With real yields turning low and precious metals regaining their luster, it seems increasingly likely that gold price action has officially bottomed around $1,680/oz.

Gold prices now look teed up for continuation higher following the latest move above $1,800/oz. The advance this week appears to have coincided with an acceleration in bullish momentum as highlighted by the MACD indicator and upswing in the relative strength index. This brings channel resistance into focus as a potential topside objective for gold bulls before a bigger breakout toward all-time highs is considered.

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