Intraday Analysis – XAU Remains High

EURGBP breaks resistance

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Chart of EURGBP

The pound struggles as a jump in February’s CPI may force the BoE to press for more rate hikes. The euro has bounced off this year’s low of 0.8730 and a subsequent surge above the key supply area around 0.8840 prompted sellers to cover their positions, easing the downward pressure. As the RSI flirts again with the overbought area, the next step is to see follow-up buying around the fresh support of 0.8810. A close above 0.8870 would attract more momentum buyers and extend the rally to the March high of 0.8920.

XAUUSD tests peak

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Chart of XAUUSD

Gold bounces back as safe haven demand jumps amid ongoing tightening. The precious metal has soared to an 11-month high at the psychological level of 2000. While the bullish MA cross shows an acceleration to the upside, the RSI’s double top in the overbought area suggests that the bulls could use some breathing room. On the hourly chart, 1935 saw bids from short-term trend-followers. Further down, 1874 over the 20-day SMA would be the bulls’ second layer of defense. A pop above 2005 would resume the climb.

SPX 500 drops back

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Chart of US500

The S&P 500 closed lower after the Fed kept its options open for future hikes despite systemic worries. After stabilizing the market and finding a bottom at 3820, a series of higher lows helped the index claw back previous losses. However, the supply zone between the psychological level of 4000 from a previous sell-off and 4010 has proven to be a tough hurdle to overcome with a shooting star suggesting a rejection of the breakout. With the RSI back into the oversold area 3870 is a key support to keep the recent recovery valid.

More By This Author:

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USDCHF: Standard Or Triple Zigzag?
Fed Expected To Hike By 25bps

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