Gold prices held up on Friday despite a rising dollar and a decline in the Euro following worse than expected European data. The Fed earlier in the week was more dovish than expected which eased dollar strength allowing gold prices to gain traction. Yields have been on the retreat, with the German 10-year falling into negative territory. Slowing gold concerns in the US has flattened the yield curve which could point to a recession.
Technical Analysis
Gold prices moved higher but continue to trade sideways, glinging in a grinding upward trend. Support is seen near the 50-day moving average at 1,305. Additional support is seen near the 10-day moving average at 1,304. Momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. This occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in the black with an upward sloping trajectory which points to higher prices and accelerating positive momentum.