UOB Bank expects gold to fall strongly if it breaks this level – Expert Analysis

Arabictrader.com – Quek Ser Leang, market strategist at UOB Group, provided a technical analysis about movements during the coming period. In this regard, the economic analyst discussed that after spot gold prices rose to the level of $2072 an ounce, it can be seen that progress towards this level lacks momentum. , when looking at the Moving average convergence/divergence (MACD) indicator on the daily time frame.

The expert also highlighted that immediate has the potential to rise further towards the top of the rising wedge near 2100 before downside risks increase, in light of the testing of the Ichimoku Cloud.

During previous forecasts, UOB Bank stated that if the spot price of gold fell below $2020, it would likely test $1963, but not only did the gold price break below $2020 in the middle of last month, but the gold price also breached $1963.

And on Tuesday of this week on May 30, 2023, gold fell to its lowest level at $1932, and as of last week it became 0 > MACD on the weekly time frame, reflecting a clear decline in momentum, which led to growing possibilities of falling gold prices in the near term. .

The analyst continued, that spot gold should break the support level at the bottom of the Ichimoku Kinko Hyo Cloud on the daily frame, which now stands at $1920, before witnessing weakness towards $1870 (note that the current level of the 55-week exponential moving average).

It should be clarified that the Ichimoku Kinko Hyo cloud is used to identify areas of resistance, support, and oversold and overbought areas.

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