Gold had a breakout on the upside rising nearly $20 for the week which was on the anticipated lines. This upmove took out the past 3 week’s resistance at $1284-$1285 and also closed higher in the upper band of the bollinger band. Such a move was highly on the cards since technically gold had formed an ascending triangle pattern on weekly timeframe. On closing basis, gold closed significantly higher above the resistance at $1284 thus indicating fresh buying and deciding the trend for the metal prices. Gold now is back in the bullish tone, where prices are expected to go higher above the $1300 mark.
On the chart –
Gold’s spring board breakout suggests the directive move which it was lacking from past 3 weeks. Though it was unable to close higher above the resistance at $1297 but still managed to close above $1292 which is considered extremely bullish. Trending market suggests more upmove in gold in coming days. We have 2 scenarios –
1. Gold managed to break above the blockage at $1284-$1285 area, this suggests the upcoming move on the upside. If this resistance now a support holds gold is expected to go higher to $1297. If this triple top resistance is broken through it can rally above $1300 to $1308. And if this area is crossed it can head towards the next resistance at $1317 .
2. There are no short trades unless $1284 gives way and that also is limited to $1270-$1272 for the moment.
Bullish view – Bulls were on a rampage as they took out resistances and led the metal higher to the highs of $1297 which though resisted as its a very important resistance. Such a move in one direction after weeks of indecisiveness suggests more gains ahead. Clearly bulls were on a sweet song as price action supported every move ahead taking out bearishness from the mood. This trend is likely to stay as its a breakout and if it does then the prices are expected to go higher.
There is no bearish view unless supports are broken.
On larger terms, Gold has turned bullish and the prices are expected to head higher.
Possible trades are on both sides but largely on long side, Gold can be bought above $1297 for the targets of $1308 and $1317 with a stop loss placed below $1284. Longer term target $1334.
There is no positional short trade unless $1284 breaks, and if it does still its limited to $1270.
On the chart –
Gold’s spring board breakout suggests the directive move which it was lacking from past 3 weeks. Though it was unable to close higher above the resistance at $1297 but still managed to close above $1292 which is considered extremely bullish. Trending market suggests more upmove in gold in coming days. We have 2 scenarios –
1. Gold managed to break above the blockage at $1284-$1285 area, this suggests the upcoming move on the upside. If this resistance now a support holds gold is expected to go higher to $1297. If this triple top resistance is broken through it can rally above $1300 to $1308. And if this area is crossed it can head towards the next resistance at $1317 .
2. There are no short trades unless $1284 gives way and that also is limited to $1270-$1272 for the moment.
Bullish view – Bulls were on a rampage as they took out resistances and led the metal higher to the highs of $1297 which though resisted as its a very important resistance. Such a move in one direction after weeks of indecisiveness suggests more gains ahead. Clearly bulls were on a sweet song as price action supported every move ahead taking out bearishness from the mood. This trend is likely to stay as its a breakout and if it does then the prices are expected to go higher.
There is no bearish view unless supports are broken.
On larger terms, Gold has turned bullish and the prices are expected to head higher.
Possible trades are on both sides but largely on long side, Gold can be bought above $1297 for the targets of $1308 and $1317 with a stop loss placed below $1284. Longer term target $1334.
There is no positional short trade unless $1284 breaks, and if it does still its limited to $1270.
