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Today I’m checking out spot gold’s monthly chart for long-term reversal opportunities.

Spot Gold (XAU/USD): Monthly

Spot Gold (XAU/USD) Monthly Chart

Spot Gold (XAU/USD) Monthly Chart

Spot gold (XAU/USD) ended August in the red, which means that the commodity just registered its FIFTH consecutive monthly decline.

That’s the longest losing streak for the commodity in four years!

We don’t have far to look for the culprit.

While post-pandemic global growth concerns and Europe’s energy crisis are driving investments into safe-haven gold, the prospect of higher interest rates in the U.S. is pushing traders into buying even more USD.

Thanks to the Fed’s hawkish rate hike schedule, the dollar is outperforming gold as a safe-haven…for now.

XAU/USD turned lower from the $2,000 psychological area and is now trading closer to the $1,700 levels.

As you can see, $1,700 lines up with the “neckline” of the Double Top pattern on the monthly time frame.

Will we see a downside breakout this month?

August’s candlestick is pretty bearish so I wouldn’t rule it out. A clear break below $1,700 opens XAU/USD to a move down to $1,550 if not the $1,400 resistance level seen in 2014 to 2018.

But what if $1,700 holds as support?

If XAU/USD is still above the $1,700 neckline by the time the markets have priced in the rest of the Fed’s interest rate increases, then we could see XAU bounce back to $1,800 or $2,000.

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