Chapter 6 Gold is getting stronger will the bulls win the race
Fundamental analysis
A big bounce for the ounce of gold after it recorded a new low at 1614 levels, for the rebound for several reasons, most notably:
- A sharp decline in the US dollar after negative data from jobless claims and gross domestic product.
- The Russian President's announcement of the annexation of 4 Ukrainian regions to Russia, as some countries denounced this act and described it as an illegal act, indicates negative results in the coming days.
Australian sanctions amounted to imposing a ban on Russian gold imports in response to the Russian military operation in Ukraine.
- A series of frightening events around the world, such as a hurricane in Florida, which caused mass destruction, and the media described it as a disaster.
On the other hand, this week is interspersed with several speeches by the members of the Federal Open Market Committee (FOMC), which may have a clear impact on the markets, especially after a series of collapses that affected the major currencies and global indices.
Technical analysis
On the weekly time frame, we see a positive candle that indicates a corrective reversal in prices, as there is a possibility of a return to the levels of 1700 USD per ounce.
As for the daily time frame, we also see a sign of price correction, and it is confirmed by the four-hour time frame, where we see an inverted sideways head and shoulders pattern, which when it is achieved, the bulls will launch to the upside above 1700 levels.
If the pattern fails and the dollar regains its strength, the bears will prevail, gradually returning to retest the 1614 resistance.
This week is critical, especially with the acceleration of events with many fiery statements that will make volatility sharp.
For gold bullion, we always advise buying in parts to take advantage of fluctuations and to enhance the gold savings portfolio
