Gold price failed to gain a footing above the 80.0% weekly basis triggered a retracement to the parallel support at 1320.50$. The yellow metal extended its rebound and retested the crucial hurdle at the key fib reaction. The indicators gave a mixed outlook as the stochastics about to turn bearish. Especially the RSI has been painting negative divergence, and we cautioned traders twice this week.
Chart of the Week: Gold

Gold: The price has been moving higher but overbought and negative RSI divergence could pause the rally sooner.

Posted by Key To Markets on Sunday, 17 February 2019

Support at the 1320.50$ held in Asia today a breakdown could shift the focus towards 20DMA at 1317.00$. Overall, the support zone finds between 1320.00-1317.00$. A break below the 20DMA may trigger losses to 1302.00$. To maintain the current rally, the bulls need to hold 1302$. Resistances seems to be at 1328.00$, 1335.00$ and 1350.00$

  • Bulls: As long as 1302.00$ is supporting, watch out for 1345.00$ and 1350.00$.
  • Bears: Sell on raise favors the trend with sl above 1376.00$ (closing basis) it’s July 2016 high coincides with the 38.2% fib reaction of 1920.00$-1046.00$ correction. Strong resistance zone seems between 1350.00$-1360.00$.

What if the price close above?

On the upside, protracted buying may trigger on a break above 1376.00$ (Weekly closing). In this case, the price may pave the way for higher prices through 1415.00$ and 1480.00$ levels in the coming months.

It is important to always keep in mind the risks involved in trading with leveraged instruments.

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