Gold tumbled last week by making a fresh eight month’s low. It broke the major support level of $1750 and went all the way down to $1717 level. It was largely due to the rising global bond yield and the news of a $1.9 trillion stimulus package by the House of Representative.
Gold broke down 50% Fibonacci retracement level of $1759, the next important support is at $1684 which is 38.2% retracement. RSI is trading at 37 and there is no sign of it Gold is oversold, meaning further weakness might come in the prices of Gold if it fails to get above its 61.8% retracement level of $1835.
Fundamentally for this week, there are two important events. On coming Thursday there is a speech by Fed Chair Jeremy Powell and later on Friday there is a Non Farm employment data which will decide the further trend of Gold.
The US dollar index made a two and a half year record low last week, however a surge in treasury yields helped the Dollar to gain some momentum. Dollar index was trading downward since March, and after it made a high of $102.99, it fell massively over 13% in the last year. Next important resistance for the Dollar index is $91.68 which is 23.6% retracement level. Once it manages to cross that it may continue to climb towards its next important resistance level of $93.84 (38.2% retracement level). Technically, RSI is showing bullish divergence on the weekly chart, which might support the Dollar Index to rise further.
Bitcoin fell by more than 23% after it made an all time high above $57000 and closed last week at $45664 level. Crypto market joined the global sell off in risky assets followed by rising yield and optimism of growth in the global economy. Bitcoin has moved up by five fold in the last year. Technically, it is taking the support at 261.8% retracement level which is at $47407. Next resistance is at 423.6% retracement at $72319, which is quite far from the current level of $47500. On the downside, next Ichimoku cloud support is at $34113 followed by $29508 which is 161.8% retracement level.
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