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Gold Price Could Rally To $1,560, US GDP Next

Aayush Jindal

Aayush Jindal

Key Highlights

  • Earlier this week, gold price surged to a new6-year high at $1,555 against the US Dollar.
  • The price remains supported near $1,525 and abullish trend line on the 4-hours chart.
  • EUR/USD is struggling below 1.1120 and GBP/USDis holding the key 1.2150 support.
  • The US GDP in Q2 2019 is likely to grow 2% (preliminary),less than the last 2.1%.

Gold Price Technical Analysis

Earlier this month, gold price climbed to a new 6-year high at $1,534 against the US Dollar. Later, it corrected lower, but dips remained supported and the price rallied to a new high earlier this week.

Gold Price Technical Analysis

The 4-hours chart of XAU/USD indicates that the price remainedwell bid near the $1,500 level and the 100 simple moving average (4-hours, red)(as discussed in the last analysis).

As a result, there was a fresh increase above $1,525 and thelast swing high at $1,534. The price traded to a new 6-year high at $1,555 andrecently corrected lower. It traded below the $1,540 and $1,535 support levels.

However, the 50% Fib retracement level of the upward movefrom the $1,493 low to $1,555 high acted as a strong support. The price is nowtrading with a positive angle and it seems like it could revisit the $1,550 and$1,555 levels.

If there are more upsides, the bulls could target the $1,560resistance area. Conversely, there are many supports on the downside near the$1,525 and $1,510 levels. Moreover, the 61.8% Fib retracement level of theupward move from the $1,493 low to $1,555 high is at $1,517.

The main support is now near $1,505, the 100 simple movingaverage (4-hours, red), and a connecting bullish trend line on the same chart.

Therefore, gold price remains well supported above $1,500and it could continue to grind higher. Only a successful daily close below$1,500, followed by a break below the $1,493 low could start a major downsidecorrection.

Overall, gold price is likely to continue higher towards $1,560 or even $1,572 as long as it is following the 100 SMA. Looking at EUR/USD, the pair is struggling to correct above the 1.1120 and 1.1125 resistance levels. GBP/USD also corrected lower recently, but it managed to stay above the key 1.2150 support.

Economic Releases to Watch Today

  • Germany’s Unemployment Change for August 2019 -Forecast 4K, versus 1K previous.
  • Germany’s Unemployment Rate for August 2019 –Forecast 5.0%, versus 5.0% previous.
  • German CPI for August 2019 (YoY) (Preliminary) –Forecast +1.5%, versus +1.7% previous.
  • German CPI for August 2019 (MoM) (Preliminary) –Forecast -0.1%, versus +0.5% previous.
  • US Initial Jobless Claims - Forecast 215K,versus 209K previous.
  • US Gross Domestic Product Q2 2019 (Preliminary)– Forecast 2.0% versus previous 2.1%.