1329/30- this region is defined by the 76.4% retracement of the 2017 decline and the upper median-line parallel of the broader ascending pitchfork formation (blue) extending off the October low. Interim support rests at the 50-line which converges on the 61.8% retracement into the start of the week at 1311.
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A closer look at near-term price action sees gold carving the monthly opening-range just below the aforementioned resistance zone with basic trendline support extending off the December lows highlighting near-term support just above 1300. A break below this threshold would risk a larger set-back in prices before resumption with such a scenario targeting 1295 backed by the 100-day moving average / median-line at 1289. That said, price is simply testing up-trend resistance.
Bottom line: The broader focus remains higher but from a trading standpoint, the immediate advance remains vulnerable while below structural resistance. IF the monthly opening range breaks lower, look for larger set-back to offer more favorable long entries, with a breach of the highs targeting subsequent resistance objectives at the 2017 & 2016 high-day closes at 1346 and 1355 respectively.
—Written by Michael Boutros, Currency Strategist with DailyFX
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.