Trading Signals for GOLD (XAU/USD) on October 3-4, 2023: buy above $1,820 or above $1,825 (21 SMA – oversold)
October 3, 2023 3:24 pm
Early in the American session, gold was trading at around 1,824, below the 21 SMA, and above the 2/8 Murray. The strong bearish pressure on gold pushed the price down to a low of 1,815.21. From this level, we observe a technical rebound. However, if gold consolidates above 1,825 in the next few hours, it could continue to rise until it reaches 1,843.
On the other hand, gold has remained under strong downward pressure in recent weeks due to comments from Fed Chairman Powell who said that there would be one more rate hike this year and reiterated in his speech that interest rates would be higher for longer. So, investors revised their portfolios bearing in mind this forecast and they took refuge in the dollar, which in turn weakened the strength of gold and a strong massive sell-off occurred.
On the other hand, the extremely oversold conditions on the daily chart and on the H-1 chart indicate that there could be a strong technical rebound in the coming hours and days. For this, we should be very cautious. Thus, it would be best to wait until gold consolidates above 1.925 and then, we can buy.
If our strategy is to sell gold, the key would be to wait for the price to first make a technical rebound and reach daily or weekly resistance levels and then resume selling due to the oversold level according to technical analysis.
If gold consolidates below 1,920, we could expect it to continue falling and the price could reach 2/8 Murray located at 1,812.50. If this level is broken, the next major support is expected around the low of 2023 at 1,804.
Given that gold is at oversold levels, the key would be to buy but with great caution since any setback will give the metal a strong technical rebound. In case this scenario comes true, we could wait for the levels of 1,820 or 1,812. Moreover, we expect a consolidation above 1,825 to buy with the target at 1,843.
The material has been provided by InstaForex Company – www.instaforex.com
Early in the American session, gold was trading at around 1,824, below the 21 SMA, and above the 2/8 Murray. The strong bearish pressure on gold pushed the price down to a low of 1,815.21. From this level, we observe a technical rebound. However, if gold consolidates above 1,825 in the next few hours, it could continue to rise until it reaches 1,843.
On the other hand, gold has remained under strong downward pressure in recent weeks due to comments from Fed Chairman Powell who said that there would be one more rate hike this year and reiterated in his speech that interest rates would be higher for longer. So, investors revised their portfolios bearing in mind this forecast and they took refuge in the dollar, which in turn weakened the strength of gold and a strong massive sell-off occurred.
On the other hand, the extremely oversold conditions on the daily chart and on the H-1 chart indicate that there could be a strong technical rebound in the coming hours and days. For this, we should be very cautious. Thus, it would be best to wait until gold consolidates above 1.925 and then, we can buy.
If our strategy is to sell gold, the key would be to wait for the price to first make a technical rebound and reach daily or weekly resistance levels and then resume selling due to the oversold level according to technical analysis.
If gold consolidates below 1,920, we could expect it to continue falling and the price could reach 2/8 Murray located at 1,812.50. If this level is broken, the next major support is expected around the low of 2023 at 1,804.
Given that gold is at oversold levels, the key would be to buy but with great caution since any setback will give the metal a strong technical rebound. In case this scenario comes true, we could wait for the levels of 1,820 or 1,812. Moreover, we expect a consolidation above 1,825 to buy with the target at 1,843.
The material has been provided by InstaForex Company – www.instaforex.com
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