XAUUSD Tech analysis by Simon Kazinsky on 10:54 January 02, 2019 EST
Technical analysis warns of renewed strength for the metal.
Gold continues to climb higher week after week even though the dollar remains in high demand against a backdrop of weak equities, commodoties and currencies. This puts the precious metal as one of the best performing assets for the last quarter of 2018 and the chart looks promising.
As can be seen in the chart the fibonacci time series have been signalling quite accuratelly previous bottoms, being the last one last summer. From there gold has gained around 10% against the allmighty buck. That bottom is the third higher low since late 2015 confirming at the very least a range, but giving the increasing uncertainty it may have marked the beginning of a new bull cycle.
If gold manages to break above $1300/oz in the next few weeks it will also break the multi year descending trendline that has prevented previous ascents.
Finally retail traders remain as ever heavily long but quite less than at the beginning of 2018. This is good news for bulls and a good rapid surge in the price of gold will trim many more.