FX.co ★ XAU/USD, GOLD

GOLD Trading Analysis Update Wednesday, February 26, 2025 After recording an all-time high, the price of Gold experienced a very impulsive decline due to profit-taking actions by some investors. Concerns about the ongoing trade war and the statement of the world's great investor Warren Buffet about being careful in investing in Gold have driven the price down. On the other hand, economists predict that the Federal Reserve (The Fed) will respond strongly and systematically to changes in inflation (CPI) and the labor market. Higher inflation could force the Fed to maintain higher interest rates, thus hampering the appeal of Gold which does not provide a return. Observing yesterday's trading, the price of Gold fell to below the psychological level of 2900. In fact, at the beginning of the week or Monday it was able to record an all-time high price of around 2955. The short-term downward rally weakened the bullish trend because the distance between the two Moving Average lines was getting closer. Meanwhile, the price is trying to go back up but is still below the 200 SMA. If the price tends to complete a retracement between FR 50 - 2921 to FR 61.8 - 2929 or fails to pass the EMA 50 to maintain the bullish trend direction. The price will tend to continue the downward rally to test the low prices of 2887. The Awesome Oscillator (AO) indicator which shows the downtrend momentum still supports the decline in Gold prices. Although the current histogram is green, the volume looks wide in the negative area and is not too close to level 0. The Stochastic indicator parameters have entered the overbought zone at level 90 - 80. Indicates that the saturation point of buying may be reached soon and is just waiting for the parameter to cross. Thus, the price that is trying to move up will stop and the downward rally can run again until the parameter indicates the saturation point of selling.

Setup entry position: Short-term trading options may prefer to focus on waiting for the SELL moment , because the bullish trend direction is weakening and there is a possibility of a death cross signal from two adjacent Moving Average lines. Entry position placement can be done while the price is still consolidating between FR 50 - 2921 to FR 61.8 - 2929. The closest take profit is taken at FR 23.6 - 2903 or the psychological level of 2900 then place a stop loss at FR 78.6 - 2941. Initial confirmation ensures that the Stochastic indicator parameters have crossed the overbought zone at level 90 - 80. While the volume histogram of the AO indicator has widened again below level 0 or the negative area and is red.