Gold 07.11.2019 – Rejection of the important resistance at $1.425

Industry news:

“After a string of subdued readings, core inflation bolted back in June. Prices for goods and services rose 0.3% (0.29% before rounding), ending a four-month run of 0.1% gains. The increase reflects payback for undue softness in recent months, rather than the start of a sharp pickup in the trend.”

“Gains in core inflation looked more in line with recent trends.”

“Today’s report is consistent with inflation climbing back toward the FOMC’s target in the coming months. But Fed officials are increasingly concerned about the generalized weakness in inflation that has persisted this expansion. Although it is starting to get back on track, Fed officials have grown impatient over the time it is taking inflation to return to target on a sustained basis.”

Technical view:

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Gold did find resistance at the well defined resistance cluster at the price of $1.425. I found that there is 12h balance down break and the bear cross on the Stochastic and MACD oscillators, which is sign that sellers took control from buyers. Gold did back below the 3DMA, which is another sign of the weakness. There is potential for downside on the Gold with the targets at $1.394, $1.385 and $1.375. Watch for selling opportunities.

Important upward reference points:

$1.425 – Resistance cluster (yellow rectangle)

$1.438 – Major short-term swing high

Important downward reference points:

$1.394 – Fibonacci expansion 61.8% (support)

$1.385 – Swing low (support)

$1.375 – Fibonacci expansion 100%

My advice is to watch for selling opportunities with the first downward target at the price of $1.394

The material has been provided by InstaForex Company – www.instaforex.com