Gold technical analysis: Pay attention to the rise and sell, pay attention to the resistance level 4700-4720

On Thursday (April 2), global gold prices fell sharply from a two-week high, with average daily fluctuations of more than 200 US dollars, as low as 4,554 US dollars, and finally closed down more than 3%, ending four consecutive gains. While geopolitical risks pushed up oil prices, a rise in the dollar and U.S. Treasury yields, coupled with a sharp decline in market expectations for interest rate cuts, weighed on gold prices. Rising oil prices have added to inflation concerns, further complicating the Fed’s monetary policy outlook; the likelihood of a December rate cut has now fallen to just 12%.

Technical analysis: short-term weakness, rallies provide selling opportunities

Gold prices fell from $4,800 to $4,554 this morning before rebounding strongly to $4,700 in the evening, with intraday fluctuations ranging from $500 to $600. This extreme volatility meant that even wide stop-loss orders were useless if the trend was wrong, and many people who opened positions but did not expand appropriately suffered huge losses.

The technical structure became very weak. The one-hour and four-hour charts show that gold has broken through the key support levels of $4,700 and $4,600. The short-term moving average is trending lower, MACD and the green histogram expand to form a dead cross, and the relative strength index (RSI) quickly falls from the overbought area to the bearish area, clearly indicating a downward trend.

Resistance level: The $4700-4730 area (turned from early support level to strong resistance level) is the key area for shorting on rallies.

Support: $4,600 (1st major level). A break above this level would target $4,553 (today’s low), with stronger support at the psychological $4,500 level.

With markets closed all day on Friday due to the Good Friday holiday, there is the potential for large price swings on Monday. Therefore, it is not recommended to hold positions overnight. Short-term traders can consider shorting a small position near $4700-4710.

Trading strategy (for reference only)

Short selling strategy: sell in batches around $4700-4710 (20% position), stop loss at $4730, target $4650-4600, if it falls below $4550.

Long-term buying strategy: Buy in batches (20% of the trade size) at $4,550-4,560, stop loss at $4,530, target $4,600-4,630, and then break through to $4,660.

Market conditions are constantly changing; therefore, price levels should be based on real-time market movements. Strict stop loss orders are essential; avoid holding losing trades.

We welcome your likes, comments and sharing of your ideas and strategies. Let us pay attention to the fluctuations of the gold market together!

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