The gold price hits a brick wall with a technical pattern
New York (Mar 28) Gold has moved lower at the start of European trade as yields in the U.S. continue to climb. The 4-hour chart is showing an interesting pattern as the price has rejected the $1967.2/oz area. It is a traditional head and shoulders technical pattern but it could also mean a new lower high has been formed. More confirmation is needed for this though.
On the downside, the green shaded area would need to be broken to confirm the break of the pattern. $1908.5/oz is a good support area as the price has been tested there on a few occasions on this chart alone. Next up beyond that point is the $1900/oz psychological area. On the volume profile indicator, there is also a support at the high volume node at $1898/oz which is close by.
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On the topside, the pattern would be invalidated if the wave high at $1967.2/oz breaks. There has not been too much fundamental news that could spur a run on that zone but anything can happen with the situation being so volatile in Ukraine. Beyond that, the next resistance could be the upward sloping trendline and then the high on the chart. For now, the bulls need to come back into action to see any chance of that happening.
Reuters
