Gold returns towards a test of key near-term levels again

<p>The near-term chart for gold tells a better story on price action in the precious metal so far this year:</p><p>During the downside push two weeks ago, gold struggled to get above the key hourly moving averages. And after a break of the 100-hour (red line) and 200-hour (blue line) moving averages earlier this week, gold suffered a significant drop and ran close towards a test of the $2,000 mark.</p><p>But amid a turn in broader market sentiment yesterday and today, gold has rebounded all the way back up to $2,029.</p><p>And that is seeing price run up against a test of the confluence of the 100 and 200-hour moving averages at $2,030.20 to $2,031.75. For sellers, keep below that region and the near-term bias will stay more bearish. For buyers, break above that and the bias will shift towards being more bullish instead.</p><p>On the week itself, gold looks poised for yet another drop but it really could've turned out worse. After the fall earlier this week, higher rates could've threatened a much steeper decline for gold if not for some resilience in broader markets. I still reckon <a href="https://www.forexlive.com/news/will-higher-yields-come-back-to-bite-broader-markets-before-the-weekend-20240119/" target="_blank" rel="follow">there is a score to settle there</a> but if in doubt, the technicals tend to act as a guide at least.</p><p>And in this case, gold is now returning to test a critical point that has defined price momentum so far this year. The next near-term move before the weekend at least will be defined by the battle between traders at the juncture above.</p>

This article was written by Justin Low at www.forexlive.com.