Although gold rallied yesterday, following the Fed-perceived dovishness, it remains in the weak zone, between the lower blue and red bands on the daily time frame (left). However, the hourly chart shows that the precious metal rose until reacting off of resistance near the R2 pivot. The stochastic has rolled over (black ellipse), suggesting that the upwards momentum may be waning. The price is close to the R1 pivot. If it acts as support, the EMAs develop angle and separation to the upside (red ellipse), and the stochastic reestablishes 80 bullish momentum will pick up into the US session. However, if the EMAs cross bearishly and the stochastic heads towards 20 (blue arrow), shorts will likely be targeting the rally.
Senior Market Specialist
Russell Shor joined FXCM in October 2017 as a Senior Market Specialist. He is a certified FMVA® and has an Honours Degree in Economics from the University of South Africa. Russell is a full member of the Society of Technical Analysts in the United Kingdom. With over 20 years of financial markets experience, his analysis is of a high standard and quality.