Gold intraday technical analysis: Gold is testing a firm resistance zone

New York (Feb 1)  Gold has moved back into familiar territory over the past few sessions balancing at $1800/oz once again. The price had a pretty dramatic fall after the FOMC rate decision but has since recovered around a third of the drop. Inflation still remains the elephant in the room as Fed policy seems to be focused on addressing the higher commodities prices. At the moment, PMI releases, later on, will help us understand if producer prices might have peaked as the report has suggested in Europe.

Looking at the technical now, the price has come to an important resistance on the 1-hour chart below. The level at the yellow line has both a support/resistance zone and a 38.2 Fibonacci retracement line matching at the same point. Beyond that, the red resistance zone also looks firm. $1827/oz has the key 61.8% and previous consolidation high at the price level. For now, it remains to be seen if the bulls can muster up another rally significantly beyond $1800/o0.

On the downside, the main support is the consolidation low at $1780/oz. Just ahead of that level the green support area seems to be slightly firmer as it has had more touches. In the short term, the bulls are still in charge of this market but there is some key resistance zone above the current price level that could stop them in their tracks.

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