Gold Price Analysis: Gold Trades bear 4H Chart 200SMA

Gold Price Analysis : Gold consolidates on recent recovery rally from $1,764 to $1,895. The four-month falling trendline hurdle is still intact.

Gold trades near the 4-hour chart 200-candle Simple Moving Average (SMA) of $1,866, having risen from $1,764 to $1,875 in the previous seven trading days. 

The recovery looks to have been fueled by an uptick in the US inflation expectations, as discussed Tuesday. However, the metal is still down over 10% from the record high of $2,075 registered in August. 

Some analysts say the broader bull market from lows near $1,450 observed in March is intact, and the metal has seen at least six pullbacks of 10% in the previous bull cycle. 

That prospects of a re-test of that level would rise once the resistance of the trendline falling from Aug. 7 and Nov. 9 highs is scaled. The trendline hurdle is currently located near $1,930. 

Gold Price Analysis, A failure to hold above support at $1,850 would shift riks in favor of a decline to recent lows below $1,800.

Gold prices fell in Indian markets today as equity markets rallied across the world amid covid vaccine optimism. On MCX, February gold futures fell 0.6% to ₹49815 per 10 gram while silver tumbled 1.2% to ₹64,404 per kg. Weighing on gold price is progress on vaccine front and weaker investor interest, say analysts. In the previous session, gold had ended 0.2% higher while silver had dipped 0.6%.

In international markets, gold prices eased today as encouraging vaccine developments pushed investors towards riskier equities. But hopes of more US stimulus kept gold supported at lower levels. Spot gold fell 0.3% to $1,865.46 per ounce.

Among other precious metals, silver slipped 0.7% to $24.38 an ounce, while platinum rose 0.6% to $1,028.17 and palladium was up 0.1% to $2,311.87.

US Treasury Secretary Steven Mnuchin on Tuesday said he had presented Democrat House Speaker Nancy Pelosi with a new economic rescue package. The $916 billion plan is bigger than the $908 billion proposal put forward last week by a bipartisan group of lawmakers. Gold, considered a hedge against inflation and currency debasement, has risen more than 25% this year in Indian markets, benefiting from near-zero interest rates and the risk of higher inflation likely to result from massive stimulus globally.

Gold traders will be eyeing progress in post-Brexit trade deal talks. British Prime Minister Boris Johnson is due to hold crunch talks with EU chief Ursula von der Leyen.

The rollout of covid vaccines in Britain and prospect of imminent authorisation in the US has added to the optimism for risk assets. Britain became the first country to start administering the Pfizer covid vaccine to its population, kicking off the Covid immunization campaign.

Gold Price Analysis: Gold Trades bear 4H Chart 200SMA via @goldsilverrepor
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