The Gold Price has Been Declining Since January 1st – Where Does the Dip Stop?

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Gold has performed sluggishly on the price charts since the first week of January. There has been a decline in its value due to the current geopolitical conditions.

At this time, investors are wondering whether it will bounce back and reach new highs near the end of January, or is there another decline on the way.

Gold Price Analysis  

The XAU/USDT daily chart on TradingView shows that the asset’s price has steadily increased since October 2023. However, this increase is not necessarily consistent, there have been quite a few red candles in between. 

The chart for January 2024, however, shows a consistent decline. While the to-date decline has been only 1.24%, it is still significant considering how gold has been a historically stable asset. 

XAU/USD chart

With the gold price currently hovering around the $2k mark, it doesn’t seem likely that it will move much beyond this level. As far as the technicals are concerned, the community sentiment around this token is still neutral. However, a deeper analysis of the moving average shows a “Buy signal”, with many believing that the asset is currently hovering at a low point to bounce back soon. 

The decline of this commodity has been steady, with the green candles not showing any significant length. 

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What is the reason behind these lows? Experts point out that the upbeat US employment details are to blame. The Nonfarm polls show that the US labor market is still resilient, which means that the Federal Reserve might not become more lenient when it comes to Fed rate increases. That has led investors to scale back their gold investments.

Gold Price Prediction – Where Could Gold Land In the Coming Days

While the yellow metal stayed resilient in most of 2023 before plunging to $1800 in October, a micro-view of the chart shows that the value has steadily increased since then.

Hourly charts show that Gold is accumulating around the $2k mark, forming an equal number of green and red candles. As the market remains neutral, there has been a similar push and pull around this asset. 

Gold price chart

The Gold price must increase to test $2055 to reach its early January highs. However, since the Gold bears are still in control, it is unlikely that it will happen anytime soon. 

Furthermore, the asset’s current RSI (Relative Strength Index) is around the 53 mark on the hourly candle chart. Due to the indicator being a bit closer to the overbought zone, the Gold price will likely slide to around the $2023 level. 

In the long-term, expect the decline to be even more pronounced. However, as soon as the Gold price hits the oversold zone, there will be a major bounce. If the geo-political conditions are conducive and the macroeconomic conditions get better, gold may be able to retest its November 2023 highs. 

Explore Trade Nation to Invest in Gold 

While the market shows a bit of a downtrend for the Gold price, now is a good time to check out the gold CFD market. With Trade Nation, you can engage with CFD trading with up to 5000x leverage. 

Trade Nation

A platform designed to deliver low-cost trading services, Trade Nation offers traders a wide array of perks. 

Along with MetaTrader 4, Trade Nation also comes with its proprietary platform, TN Trader. The platform has also introduced TradeCopier recently, allowing you to follow in the footsteps of more successful traders. 

Being licensed is another reason Trade Nation is sought-after. Bodies like FCA, ASIC, SCB, and FSA have approved the platform. Click the link below to start trading Gold and Gold-related assets through Trade Nation. 

Visit Trade Nation

Financial Spread Bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 86% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. 

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Alan Draper
Editor
Alan Draper
Editor

Alan is the Editor-in-Chief of Techopedia and is responsible for ensuring all the content is accurate, up to date, and relevant. Alan has previously worked in writing and editorial capacities for several leading websites, such as Business2Community and TechReport.