Technical Analytics Report

XAU/USD: Fundamental Analysis Report

XAU/USD: Fundamental Analysis Report 17 May 2021

 

Current trend: the increase of demand instigates the asset strengthening.

Gold quotes continue corrective growth, trading at $1,855 per ounce. After the lifting of quarantine restrictions, the global demand for metals went up sharply, provoking price growth. 

At the moment, industry leaders are beginning to actively recover from the consequences of the pandemic, increasing gold production, which will undoubtedly affect the price of the precious metal. Yesterday, the South African statistics service published data on mining for March this year. According to official data, the figure rose by 21.3%, the growth of platinum ore production was 68.6%, and of gold – 10.5%. However, the volume of sales of the asset rose much higher, at 61.3%. 

Thus, the strengthening of world metal production and the current negative trend in the US dollar contribute to the positive dynamics of the instrument. 

Support and Resistance 

On the global chart, the price reaches the resistance line of the global downtrend and its breakout will allow the rate to reach 2000.0 by the end of May. Technical indicators keep a global buy signal: the fluctuation range of the Alligator EMA is quite wide, and the histogram of the AO oscillator is trading in the positive zone. 

·         Resistance Levels: 1871.0, 1955.0.

·         Support Levels: 1815.0, 1763.0. 

Trading Tips 

After global growth or consolidation above the resistance line of 1871.0, buy positions with the target at 1955.0 will be relevant. Stop loss is 1820.0. Implementation period: 7 days or more.

 After reversal and decline or consolidation below the local support level of 1815.0, sell positions with the target at 1763.0 will be relevant. Stop loss is 1850.0.

 Scenario 

Timeframe: Weekly

Recommendation: Buy Stop

Entry Point: 1871.0

Take Profit: 1955.0

Stop Loss: 1820.0

Key Levels: 1955.0, 1871.0, 1815.0, 1763.0 

Alternative Scenario 

Timeframe: Weekly

Recommendation: Sell Stop

Entry Point: 1815.0

Take Profit: 1763.0

Stop Loss: 1850.0

Key Levels: 955.0, 1871.0, 1815.0, 1763.0


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