Gold: Historical High is now Insight

On Thursday, spot gold marked a day-high near $1,899, which is not far from its historical high near $1,920, and ended 0.9% higher at $1,887...

Gold 1

On Thursday, spot gold marked a day-high near $1,899, ending 0.9% higher at $1,887. On the other hand, spot silver retreated 1.8% and the gold/silver ratio rebounded 2.7% after a 13.0% decline in the previous three sessions. This could possibly suggest that gold is catching up with silver.

Source: Trading Economics

Meanwhile, official data showed that the latest initial jobless claims rose to 1.416 million from 1.307 million in the prior week, the first increase since March, showing the impacts of coronavirus resurgence.

Source: TradingView, Gain Capital

From a technical point view, spot gold has formed a strong bullish rounding bottom pattern as shown on the weekly chart, and a break-through above its historical high near $1,920 is awaited.

Source: TradingView, Gain Capital

From an intraday point of view, previously we mentioned that spot gold's momentum was getting stronger, now it still maintains a bullish bias as shown on the 1-hour chart

However, there is signs of a bearish RSI divergence, which may suggest a potential downside correction before the next rally. Bullish investors may consider $1,860 as the nearest intraday support, while a break above the nearest resistance at $1,898 would open a path to the next resistance at $1,920. Alternatively, losing $1,860 would indicate that the next support at $1,846 is exposed.

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