GOLD – $1170 – A Key Level

XAUUSD, Daily               

The Gold price has been under significant pressure since US Election day (where it touched $1334 intra-day) and has just closed its worst month in over three years, having declined 8% in November. Earlier today it tested and then broke the key psychological and technical $1170 level.  Should this break be maintained then I would be looking for SHORT positions with an initial Target 1 at $1144 and Target 2 $1120.

The $1170 level represents the 61.8 Fibonacci retracement level from the 2016 high in June at $1375 and a 10 month low for the Gold price. The USD strength during November has added to the decline in the price, together with the tightening of capital flows out of China.  Today the London FT reported that China (a major buyer of gold it all its forms) is tightening gold import quotas to prevent USD outflows from the country.  Chinese banks will be required to use USD quotas when buying gold.

The RSI and MACD suggest the price is already oversold, however the widening Bollinger bands remain pointing down, the Parabolic SAR, and On Balance Volume suggest further downside potential.



Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work.

Click HERE to register the next webinar will start in:

Stuart Cowell

Market Analyst


Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.