Gold continued to flag gaining over $11 in another big range week where again a near $30 swing was visible. Gold took support at the flag’s low of $1196-$1198 while rising as high as $1225 which acted as a barrier making the price to finally settle at $1221 which is a good sign for the bulls as the support of $1217 showed strength.With political tensions cooling of a bit the yellow metal rose against the theory of safe haven as dollar continued its slide downwards. Clearly, by the look of the week’s price action gold technically is moving in a flag which got confirmed and a break of which on either side should give a clearer direction till then it may seem a choppy range bound trading between the boundaries of the flag.
On the chart –
Gold regained a lot of lost ground which it shed in the week before owing to a falling dollar and the technical confirmation of a flag being formed in larger timeframes. Now, this flag can lead to outbreak of both bullish and bearish moves once price moves outside of it so in simple terms gold has returned to its border trading thus has more of a neutral bias than bullish or bearish till a trend is confirmed.
1. Gold has closed above the support of $1217, till this is held its expected to head higher to $1228. once this is crossed it can lead to $1236. And if this is crossed it can climb till $1243 with $1251 being the next target.
2. Short trades a plenty in this rangebound movement but primarily focused on scalping by selling the tops/resistance. Once the flag support breaks it can fall to levels of $1185 and $1162
Bullish view – Bulls had saved themselves by defending the support and dutifully the price rallied from the lows to hit the resistances. The trend seems to remain intact for the bulls but they need to keep defending flag supports which will certainly trail higher due to the nature of the flag. On a brighter view, gold has tested the bottom of the range and is expected to now test the highs so more rallies on the upside remain on the cards.
Bearish view – Bears fought hard to break the support but failed owing to a weakening dollar and adverse fundamentals. For them to carry out fresh activities they need to break the flag on the downside till then they can have a push and pull inbetween supports and resistances.
On larger terms, Gold has turned sideways as range bound movement takes the center stage. and prices are expected to move in a range until a direction is decided via the break of it.
Possible trades are on both sides, gold can be bought above $1228 for the targets of $1236 and $1241 with a stop loss placed below $1217. Longer term target $1251.
Short trades come to play once the flag support is broken which can lead to $1185 and $1162 till then its a perfect scalping tool.
On the chart –
Gold regained a lot of lost ground which it shed in the week before owing to a falling dollar and the technical confirmation of a flag being formed in larger timeframes. Now, this flag can lead to outbreak of both bullish and bearish moves once price moves outside of it so in simple terms gold has returned to its border trading thus has more of a neutral bias than bullish or bearish till a trend is confirmed.
1. Gold has closed above the support of $1217, till this is held its expected to head higher to $1228. once this is crossed it can lead to $1236. And if this is crossed it can climb till $1243 with $1251 being the next target.
2. Short trades a plenty in this rangebound movement but primarily focused on scalping by selling the tops/resistance. Once the flag support breaks it can fall to levels of $1185 and $1162
Bullish view – Bulls had saved themselves by defending the support and dutifully the price rallied from the lows to hit the resistances. The trend seems to remain intact for the bulls but they need to keep defending flag supports which will certainly trail higher due to the nature of the flag. On a brighter view, gold has tested the bottom of the range and is expected to now test the highs so more rallies on the upside remain on the cards.
Bearish view – Bears fought hard to break the support but failed owing to a weakening dollar and adverse fundamentals. For them to carry out fresh activities they need to break the flag on the downside till then they can have a push and pull inbetween supports and resistances.
On larger terms, Gold has turned sideways as range bound movement takes the center stage. and prices are expected to move in a range until a direction is decided via the break of it.
Possible trades are on both sides, gold can be bought above $1228 for the targets of $1236 and $1241 with a stop loss placed below $1217. Longer term target $1251.
Short trades come to play once the flag support is broken which can lead to $1185 and $1162 till then its a perfect scalping tool.
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