By Dmitriy Gurkovskiy, Chief Analyst at RoboForex
Gold is looking quite stable during the second week of July – the asset is trading at $1785.40 USD after updating its last week’s highs at $1807.70.
Here and now, market players are finally paying enough attention to the macroeconomic: expectations from China are quite positive as the country’s economy is anticipated to recover faster and stronger than other countries. This, in its turn, slows down investors' interest in “safe haven” assets, including Gold.
However, it’s clearly seen that strategically investors are in no hurry to ditch their long-term positions in Gold, and it’s understandably why. The COVID-19 hasn’t been defeated yet, and that’s a risk. Global economies are still experiencing the crisis, and that’s a risk too. The American Dollar may remain under pressure for a long time, and that’s good for Gold.
All this taken together creates strategic support for the price of Gold, that’s why there are no rapid decisions to sell the instrument.
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As we can see in the H4 chart, XAU/USD is trading to break 1778.86 to the upside and may later continue growing towards 1800.00. Later, the market may start a new correction to return to 1778.00 and then form one more ascending structure with the target at 1818.20. From the technical point of view, this scenario is confirmed by MACD Oscillator: its signal line is moving above 0, thus indicating further uptrend on the price chart.
In the H1 chart, XAU/USD is growing towards 1778.80. After reaching this level, the pair may form a new consolidation range and then break it to the upside. In this case, the pair may continue growing with the short-term target of another ascending wave at 1786.50. From the technical point of view, this scenario is confirmed by Stochastic Oscillator: its signal line is moving directly upwards, thus confirming further uptrend until the line breaks 80. After that, there might be a correction on the price chart, while the line is expected to fall towards 50.
Disclaimer
Any predictions contained herein are based on the author's particular opinion. This analysis shall not be treated as trading advice. RoboForex shall not be held liable for the results of the trades arising from relying upon trading recommendations and reviews contained herein.