Gold faced another week of consolidation where the price moved between a range of $21 finally ending with gains of $4. Both, the support and the resistance were tested as gold managed to conquer $1300 again on closing basis. The long term trendline was once again tested and the price bounced back suggesting it holds good value and acts as a massive protection from downside. Till this support is held the prices are bound to head higher.
On the chart –
Gold had a similar week like the one before consolidating in a range with very little actual movement. Fundamentals continue to aid higher gold prices as developments across the globe still are a cause of worry creating new clouds of uncertainty and confusion. We have 2 scenarios –
1. Gold closed above the support, till this is held it can rise to $1308. Once this is crossed it can head towards $1318. If this is taken out it can rally towards $1327 and next $1341.
2. Short trades continue to remain invalid as the support was held again, they come into play once the support is broken for targets of $1284 and $1273.
Bullish view – Bulls managed to scale the price back above $1300 again after winning another battle against the hungry bears. Though the gains were not very big but in the end it was a green candle which is a celebratory thing for the bulls. Bulls managed to defend the support of the long term trendline again which was crucial for keeping the overall trend intact. For bulls to remain on the heavier side they need to hold the support.
Bearish view – Bears continued to haunt as they tried to break the support once again but yet again failed suggesting the price action is still bullish and it will take more than just the haunts to break through the wall of the long term trendline. For bears to get considered they need to break the support.
On larger terms, Gold remains bullish and prices are expected to head higher.
Possible trades are on both sides, gold can be bought above $1310 for the targets of $1318 and $1327 with a stop loss placed below $1302. Longer term target $1341.
Dips towards support can be used to create longs for the above mentioned targets.
Short trades come into the picture once the support gets broken for targets of $1284 and $1273.
On the chart –
Gold had a similar week like the one before consolidating in a range with very little actual movement. Fundamentals continue to aid higher gold prices as developments across the globe still are a cause of worry creating new clouds of uncertainty and confusion. We have 2 scenarios –
1. Gold closed above the support, till this is held it can rise to $1308. Once this is crossed it can head towards $1318. If this is taken out it can rally towards $1327 and next $1341.
2. Short trades continue to remain invalid as the support was held again, they come into play once the support is broken for targets of $1284 and $1273.
Bullish view – Bulls managed to scale the price back above $1300 again after winning another battle against the hungry bears. Though the gains were not very big but in the end it was a green candle which is a celebratory thing for the bulls. Bulls managed to defend the support of the long term trendline again which was crucial for keeping the overall trend intact. For bulls to remain on the heavier side they need to hold the support.
Bearish view – Bears continued to haunt as they tried to break the support once again but yet again failed suggesting the price action is still bullish and it will take more than just the haunts to break through the wall of the long term trendline. For bears to get considered they need to break the support.
On larger terms, Gold remains bullish and prices are expected to head higher.
Possible trades are on both sides, gold can be bought above $1310 for the targets of $1318 and $1327 with a stop loss placed below $1302. Longer term target $1341.
Dips towards support can be used to create longs for the above mentioned targets.
Short trades come into the picture once the support gets broken for targets of $1284 and $1273.
Comment:
Trade Active
Comment:
First long target met at $1318
Comment:
A buy on dips strategy is useful for going long on gold at key support areas
Comment:
The buy-on-dips strategy worked out pretty well
Trade closed manually