Gold Prices Vulernerable as Rally Extends into Resistance

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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Gold 240min

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

Follow Michaelon Twitter @MBForex contact him at or Click Here to be added to his email distribution list.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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