Jump to content

Gold Price Forecast: Gold Weekly Evening Star Casts a Large Shadow


Recommended Posts


  • Gold prices just completed an evening star on the weekly chart, a pattern often followed with the aim of bearish reversals, hypothesizing that a top may have been set.
  • The hurried momentum from early-March has now been entirely erased and Gold prices are trying to buoy around support in the 1900 zone. Shorter-term keeps the door open for bullish scenarios but longer-term retains a bearish leaning due to that bigger-picture reversal formation.
  • The analysis contained in article relies on price action and chart formations. To learn more about price action or chart patterns, check out our DailyFX Education section.
Gold Price Forecast: Gold Weekly Evening Star Casts a Large Shadow

Gold prices are starting the week at a key spot of support, just above the psychological level of 1900 that was re-tested on FOMC day last week. The low in Gold printed at around 2:20 last Wednesday, so after the statement release but just before Chair Powell took the podium to begin the press conference. During the press conference, buyers jumped in as shorts quickly covered and prices pushed right back to the short-term resistance level of 1930. While buyers were able to extend that move up to 1950, they weren’t able to negate the evening star reversal pattern that’s built on the weekly chart.

The evening star pattern is followed for bearish reversals, driven by the idea that price action may have set a top.


Gold weekly price chart

Chart prepared by James Stanley; Gold on Tradingview


At this point there are two notable longer-term levels that are playing a role with short-term price action, and for sellers, they’re going to want to see these levels dealt with first before adopting bearish momentum strategies. The first level is helping to set support this morning and it’s at 1919, which was the yearly high until the recent bullish breakout. And below that we have the psychological level at 1900 that came into play very briefly last week. Sellers pushing below 1919 opens the door for a test of 1900, and sellers pushing below that opens the door for a move down towards 1845, where there remains some unfilled gap from February trade.


Gold daily price chart

Chart prepared by James Stanley; Gold on Tradingview

--- Written by James Stanley, Senior Strategist for DailyFX.com. 21st March 2022

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • Posts

    • Sainsburys full year earnings and Unilever’s first quarter trading update both say the same thing, UK consumers are in for higher prices. The war in Ukraine, supply chain issues and the effects of ongoing Covid all to blame.      
    • US Dollar (DXY) Daily Price and Analysis US Q1 GDP may stall the greenback’s advance. A 20-year high nears for the US dollar. The multi-month US dollar rally continues with the greenback printing a fresh high today ahead of the first look at US Q1 GDP at 12.30 GMT. The US dollar basket (DXY) has been boosted by renewed weakness in the Euro and the Japanese Yen, as investors move from lower-yielding to higher-yielding currencies, while safe-haven flows continue to benefit the greenback. The US growth release later in the session is expected to show a sharp slowdown from the robust Q4 figure of 6.9%. The markets are currently pricing in growth of just 1% for the first three months of this year, with the slowdown mainly due to a reduction in inventory accrual over the quarter. This release is unlikely to move the greenback, unless there is a large miss or beat, as the Fed believe that 2022 US growth will be robust enough to let them tighten monetary policy sharply without damaging the economy. The latest US Core PCE data – the Fed’s preferred inflation reading – is released on Friday and this may have more effect on the US dollar than today’s GDP data. For all market moving economic data and events, see the DailyFX Calendar. The ongoing US dollar rally has been aided by weakness across a range of G7 currencies including the Euro, the Japanese Yen, and the British Pound. The Euro continues to battle with lowly growth expectations, exacerbated by energy concerns, the British Pound is mired by weak economic data, while the Japanese Yen is in freefall as the BoJ continues with its ultra-loose monetary policy.   The US dollar continues to press higher and looks set to break above 103.96, the March 2020 high. Above here the US dollar would be back at levels last seen nearly two decades ago. The March resistance will likely hold in the short-term, especially with month-end portfolio rebalancing at the end of the week, but US dollar strength is set to continue in the months ahead. USDOLLAR (DXY) WEEKLY PRICE CHART – APRIL 28, 2022 {{THE_FUNDAMENTALS_OF_BREAKOUT_TRADING}} What is your view on the US Dollar – bullish or bearish?   Apr 28, 2022 | DailyFX Nick Cawley, Strategist
    • While Tesla has nothing directly to do with Elon Musk buying Twitter - TSLA stock closed down 12% on news that Musk may have to sell stock and use other holdings to stand against the loan to finalise the purchase of the social media giant.        
  • Create New...