Gold: supported by weaker USDDuring the previous week markets were focused on inauguration of the new-old US President and the steps which he will take in the future period. The most critical ones are related to potential US tariffs on imported goods, especially from China. As the US Dollar was weakening during the previous week, the price of gold headed toward its ATH levels. The highest weekly level reached was at Friday's trading session at $2.785. Still, the price of gold ended the week at the level of $2.771.
With the latest move toward the upside, the RSI reached the level of 69, which is almost at the level of the overbought market side. This is also the level which implies the higher probability for a short term reversal in the coming period. The moving average of 50 days started modest divergence from MA200, implying that there will be no cross in the near future.
The week ahead will be full of important events, including the PCE data and FOMC meeting. This will certainly bring some higher market volatility. Whether the price of gold will be able at this point to pass the historical ATH is to be seen. Charts are also implying the possibility for a short term reversal. In this case, the price of gold might revert a bit back toward the support line at $2.720.
