Gold Price Prediction – Gold Rebounds Above The $1765 Level

Key Insights

• Gold moves higher, supported by weaker dollar and lower Treasury yields. 
• Gold continues its technical rebound from yearly lows. 
• If gold settles above the $1765 level, it will have a good chance to test the 50 EMA at $1785.

Gold Stays Strong At The Start Of The Week

Gold is gaining some ground as the U.S. dollar slides after the release of the U.S. Manufacturing PMI report. Meanwhile, the yield of 10-year Treasuries is testing multi-month lows, which is bullish for gold that pays no interest.

From a big picture point of view, gold continues to rebound from yearly lows near the $1680 level. Disappointing economic reports and traders’ focus on recession risks provided significant support to gold, while the weak dollar served as an additional positive catalyst.

That said, it remains to be seen whether gold will regain its status of a safe-haven asset in the upcoming months. At this point, traders rush to the safety of government bonds. The yield of 10-year Treasuries declined from 3.50% in mid-June to 2.60%. The yield of 10-year German government bonds decreased from 1.92% to 0.80%.

While lower yields are certainly bullish for gold, the precious metal will need additional catalysts to develop a sustainable upside trend.

The Next Significant Resistance For Gold Is At The 50 EMA

Gold has recently managed to get above the resistance at $1765 and is trying to gain additional upside momentum. In case this attempt is successful, it will head towards the next resistance level, which is located at the 50 EMA at $1785.

A move above the 50 EMA will push gold towards the resistance at $1800. If gold manages to settle above this level, it will head towards the next resistance level at $1815.

On the support side, a move below the $1765 level will open the way to the test of the support level, which is located near the 20 EMA at $1750. In case gold declines below the 20 EMA, it will head towards the support at $1730. A successful test of this level will push gold towards the support at $1715.

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