Yellow metal seems to have lost the momentum in upswings ever since it has formed a at 1228.73 levels (see red colored cirle).
Thus far, we've seen the precious metal to surpass all major resistances decisively in February series, 1st at 1183.69, 1200.43 and at 1225.60 where demand was seen more than supply and for now likely to find stiff resistance at $1,250.75 levels, if it does not mange to hold these levels then 1250 is quite certain event.
The precious metal has been bouncing consecutively especially with a sentiment of safe haven among all asset classes from last couple of weeks but as stated in our earlier apart from that we see no fundamental reasons to substantiate these price bounces.
sends skepticism in current upswings: As the pair hits at the 1 year highs testing stiff resistance at 1250.75 levels, while evidences divergence to the previous rallies (Currently, trending around 68.2175 while articulating).
sends indecision message but slightly biased: As the price behavior losing momentum, slow curve has been in state of indecision but slightly favors bears as the selling pressures mounting and momentum is intensifying that is coupled with the standpoint offered by . A perfect %D line crossover exactly at 80 levels which is overbought zone bolsters selling pressures, (Currently, %D line is at 65.6002 and %K at 77.3811 while articulating).
Current prices are attempting drop below 7DMA quite often and is also in the mood of correction, synthesizing both together arrive with the interpretation that the prevailing upswings may take a halt and price declines are most likely.
Hence, contemplating all above technical reasoning, it is advisable to short this commodity for targets of 1096 levels with strict stop loss of 1115 levels.
Thus far we saw upswings, as we don't see the momentum in the same uptrend at this juncture and synthesizing above technical indications, we recommend shorting near month for target towards $1200 levels again, however short term traders keep a strict stop loss at 1283.11 levels on a closing basis. Thereby, we have attractive risk reward ratio.
Should the underlying commodity price keeps falling, the gain in the value of the short position will be able to offset the drop in revenue from the sale of the underlying.