Gold Settled Back Above The 50 EMA

Key Insights

• Gold quickly rebounded after yesterday’s pullback. 
• Other precious metals are also moving higher. 
• A successful test of the resistance at $1730 will push gold towards the $1750 level. 

Gold Is Moving Towards Recent Highs

Gold settled back in the $1715 – $1730 range as Treasury yields declined after yesterday’s rally.

From a big picture point of view, traders remain worried that Fed will stay hawkish regardless of economic data as it is determined to stop inflation.

Markets will remain sensitive to economic reports. Today, traders will focus on the Initial Jobless Claims report, which is expected to show that 203,000 Americans filed for unemployment benefits in a week. If Initial Jobless Claims stay below the 200,000 level, U.S. dollar may get more support, which will be bearish for gold prices.

Other precious metals are also moving higher after yesterday’s sell-off. Silver settled back above the $20.50 level and tested the resistance at $20.80. Platinum is trading near $935, while palladium managed to settle back above $2250.

The Short-Term Trend Remains Bullish

Importantly, gold failed to settle back below the 50 EMA and continues to trade in the $1715 – $1730 range. RSI is in the moderate territory, and there is plenty of room to gain additional upside momentum in case Treasury yields pull back from current levels.

Gold needs to settle above the resistance at $1730 to continue its rebound. This resistance level has already been tested several times and proved its strength. In case gold gets above this level, it will move towards the next resistance level at $1750. A successful test of the resistance at $1750 will push gold towards the $1765 level. A move above this level will open the way to the test of the resistance at $1775.

On the support side, the nearest support level for gold is located at the 50 EMA at $1715. If gold declines below this level, it will head towards the 20 EMA at $1690. A successful test of the support at the 20 EMA will push gold towards the next support level at $1675.

For a look at all of today’s economic events, check out our economic calendar.