Gold Price Recovery Could Face Hurdles, PMI’s Next
- Gold price started an upside correction from the $1,805 zone.
- It broke a major bearish trend line with resistance near $1,815 on the 4-hours chart.
- EUR/USD and GBP/USD started a decent recovery wave.
- The US ISM Manufacturing Index could increase from 47.4 to 48.0 in Feb 2023.
Gold Price Technical Analysis
Gold price gained bearish momentum after it broke the $1,840 support against the US Dollar. The price traded close to the $1,800 level before the bulls appeared.
The 4-hours chart of XAU/USD indicates that the price traded as low as $1,804. It settled below the 100 simple moving average (red, 4-hours) and the 200 simple moving average (green, 4-hours).
Recently, there was an upside correction above the $1,815 level. The price broke a major bearish trend line with resistance near $1,815 on the 4-hours chart. There was a test of the 50% Fib retracement level of the downward move from the $1,845 swing high to $1,804 low.
The price is now facing resistance near the $1,830 level and the 200 simple moving average (green, 4-hours). The main resistance is near the $1,845 zone and the, above which the price might gain bullish momentum.
On the downside, an initial support is near the $1,815 level. The next major support is near the $1,805 level, below which gold price might struggle to stay above the $1,800 zone. In the stated case, gold price could slide towards the $1,780 support.
Looking at EUR/USD, the pair started a recovery wave from the 1.0535 zone and might rise further towards the 1.0680 resistance.
Economic Releases to Watch Today
- Germany’s Manufacturing PMI for Feb 2023 - Forecast 46.5, versus 46.5 previous.
- Euro Zone Manufacturing PMI for Feb 2023 – Forecast 48.5, versus 48.5 previous.
- UK Manufacturing PMI for Feb 2023 – Forecast 49.2, versus 49.2 previous.
- US ISM Manufacturing Index for Feb 2023 – Forecast 48.0, versus 47.4 previous.