Gold prices started to lose ground after reaching record levels. This brings to mind: ‘Have we reached the end of the bull market for the yellow metal?’ brought the question. While gold has had a pair of disappointing days this week, the technical picture still points to further price gains for the precious metal, according to OANDA Senior Market Analyst Kelvin Wong.
Gold question for shiny metal!
cryptokoin.comAs you follow from , the shiny metal encountered sales after its strong rise. However, the shiny metal managed to stay above $2,300. Senior analyst Kelvin Wong points out the decline following the testing of the $2,420 intermediate resistance. According to the analyst, this move shaped gold’s mean return decline. The price of the yellow metal fell by 2.7% on Monday, April 22. Thus, it had its worst daily performance since June 13, 2022.
Yesterday’s intraday low of $2,291 represented a 5.8% loss compared to spot gold’s all-time high of $2,431 reached on April 12, Wong notes. The analyst said, “Now, gold question for Gold; “Can the bulls be revived or is it game over for the medium-term uptrend that started in mid-February 2024?” he asks.
“The Gold/Copper ratio shows there is a high demand!”
Kelvin Wong highlights several technical indicators that he believes support gold’s medium-term uptrend. These indicators start with the gold/copper ratio. According to this indicator, the analyst makes the following assessment:
This ratio takes the US dollar exchange rate effect out of the equation. This only measures the relative value of gold against copper, or its superior or inferior performance. A steady decline in the Gold/Copper ratio indicates that global economic growth is likely in expansion mode. An increase in the Gold/Copper ratio means a slowdown in economic growth or a relatively increase in the demand for gold for hedging purposes due to uncertainties.
Wong says the Gold/Copper ratio has remained above support since late November. He also points out that it has remained within a major ascending channel since October 15, 2021. “Therefore, the current configuration of the rate suggests that there is still a relatively higher demand for gold as a hedge asset for stagflation risk,” the analyst said. says.
Analyst: The medium-term bull trend is intact!
There is another technical indicator that points to further gains for the precious metal. This is the 50-day moving average (MA) that continues to support the spot gold price. From a technical analysis perspective, Wong explains it this way:
(…) Technical indicators show that the medium-term bullish phase remains intact. A break above $2,420 could see the next medium-term resistance at $2,540. On the other hand, a break below the lower bound of the medium-term important support zone at $2,210 could extend the ongoing corrective decline during the main bull trend phase to reveal the important long-term support zone at $2,075/2,035 (also the 200-day moving average).
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