Daily gold chart (XAU/USD).
Before yesterday, gold prices only moved down to test the 100-day moving average (red line) twice this year. Yes, that's right. Exactly twice. The first was in February and the second in November. During both trips, buyers held their ground but fell short of holding the trading line yesterday.
A hawkish rate cut by the Fed led to a rise in the dollar and rates, weighing on gold prices. That saw a dip below the key technical level into the daily close for the first time since October 2023.
But for today, gold buyers are hoping to try to regain that position. Price is currently up 0.9% to $2,609 with the 100-day moving average seen at around $2,605.93. It is certainly a major battle for control now in determining the next steps for gold.
For buyers, a move back above the 100-day moving average will provide some technical comfort. Otherwise, a strong break below could lead to another technical correction that could run much, much deeper on additional profit activity as well.
The sad part in all of this is that we are already into the latter part of the year over the next few sessions. It will be difficult to read into price action beyond this week as flows will narrow for the remainder of the year.
And then there is also the seasonal tail in January to consider, as that was the best month for gold prices in the last two decades.
All of this certainly makes it difficult to get a good read on what's next for gold. But at least the technical display above could give some idea, before traders return in full force in the new year.
