Price back below $1500
The price of gold is down about $5 in trading today and back below the $1500. The high reached $1510 yesterday. Today, there is less anxiety in the markets. The feeling may be that the Fed will indeed bail out the President's tariff policy. If there is a point where China blinks or the US blinks that is even better news. So gold price action is a little more calm today. It's not fully out of the woods, but the move higher has calmed down.
Technically, I look toward the closer in charts for bullish/bearish clues. Going all the way to the 5 minute chart (see chart below), the pair has a number of lower highs, that have used a topside trend line to stall the rallies (see red circled numbers on the chart below). That trend line currently comes in at $1499.83. Below that line is the 200 bar MA at $1498.25. The 100 bar MA is at $1496.34.
For me, stay below the trend line on the 5 minute chart at $1499.83. Then, move and stay below the 200 and 100 bar MAs (green and blue lines), will be bearish clues for sellers.
Move above the trend line, and although the price of gold may be overbought, I will have to respect the price action and the buying from the market.
On the downside, the low today stalled near the 38.2% at $1489.86. A move below that level and then the broken 50% midpoint at $1484.48 on the daily would give sellers more solace.
So is gold ready for a correction?
Yes.
Will it correct?
The price action, and keeping the small bearish bias developed today off the 5 minute chart will go a long way to answering that correction. We can anticipate that move, but the price action will ultimately give us that answer with help from the tools applied to that price action. For now, stay below $1499.83. Get below and stay below the 100 and 200 bar MAs. That would certainly help the correction story.
