Gold is coming up to a key technical zone
(Kitco News) - Looking at the gold daily price chart below the yellow metal has been moving higher in recent sessions back towards the $1800/oz psychological area. Close to this zone, there are some confluence resistance areas to look out for and the price could get stuck in familiar territory.
The chart below shows a blue highlighted zone that has been very sticky in the past. Not only this it was used as a very strong support in the middle of May. In addition to this, there is a trendline where the first two lower high peaks are connected when the downtrend began. When trendlines break it can be a significant sign that a trend is about to reverse. Above this area, the next major resistance is at the green zone near $1875/oz.
On the downside, the main support is at the red shaded area just under $1700/oz. At the moment that zone doesn't look like it could get threatened any time soon but if the resistance holds we could see a move back down there but it is unlikely. If we do see a break of the trendline quite often the price comes back to test the area before moving higher in the prevailing direction. For now, let's see how the U.S. traders react to the positive price action at the open.