(Trade update: Stopped out for a loss at 1221.0).
Gold took a rather brutal hit to the mid-section yesterday, dropping over 28$ in one sitting due to a stronger dollar being seen across the board! As a result of this, H4 demand at 1237.2-1243.9 was annihilated (now acting supply), as was H4 demand at 1224.6-1226.8, which has just recently been retested as supply.
Consequent to the above, a break below weekly support at 1224.1 was seen, potentially clearing the path south toward weekly demand at 1205.6-1181.2. On top of this, a close below daily demand at 1224.6-1238.3 (now acting supply) also took place, possibly setting the stage for a continuation sell-off down to daily demand at 1181.4-1200.7 (sits within the extremes of the aforementioned weekly demand).
With the above in mind, what levels are on our radar today? Well, we like the look of the 26th Feb low at 1211.3 on the H4 chart, since it fuses nicely with a 1:1 Harmonic correction (black arrows) and a 78.6% Fibonacci support level (taken from the low 1190.8). However, judging from what we’ve seen on the higher timeframes (see above), a long from here is a risky play in our book and would only be possible with the backing of a lower timeframe buy setup. In addition to this buy level, we also like the recently broken H4 demand (now supply) at 1224.6-1226.8. This area has already held ground on its first retest, so it stands a good chance if it’s tested for a second time. Therefore, as long as price does not hit 1211.3 before connecting with the above said H4 supply, we’ll be looking for lower timeframe sell opportunities around this region today.
Levels to watch/live orders:
• Buys: 1211.3 Tentative – confirmation required (Stop loss: dependent on where one confirms this level).
• Sells: 1224.6-1226.8 Tentative – confirmation required (Stop loss: dependent on where one confirms this area).
Gold took a rather brutal hit to the mid-section yesterday, dropping over 28$ in one sitting due to a stronger dollar being seen across the board! As a result of this, H4 demand at 1237.2-1243.9 was annihilated (now acting supply), as was H4 demand at 1224.6-1226.8, which has just recently been retested as supply.
Consequent to the above, a break below weekly support at 1224.1 was seen, potentially clearing the path south toward weekly demand at 1205.6-1181.2. On top of this, a close below daily demand at 1224.6-1238.3 (now acting supply) also took place, possibly setting the stage for a continuation sell-off down to daily demand at 1181.4-1200.7 (sits within the extremes of the aforementioned weekly demand).
With the above in mind, what levels are on our radar today? Well, we like the look of the 26th Feb low at 1211.3 on the H4 chart, since it fuses nicely with a 1:1 Harmonic correction (black arrows) and a 78.6% Fibonacci support level (taken from the low 1190.8). However, judging from what we’ve seen on the higher timeframes (see above), a long from here is a risky play in our book and would only be possible with the backing of a lower timeframe buy setup. In addition to this buy level, we also like the recently broken H4 demand (now supply) at 1224.6-1226.8. This area has already held ground on its first retest, so it stands a good chance if it’s tested for a second time. Therefore, as long as price does not hit 1211.3 before connecting with the above said H4 supply, we’ll be looking for lower timeframe sell opportunities around this region today.
Levels to watch/live orders:
• Buys: 1211.3 Tentative – confirmation required (Stop loss: dependent on where one confirms this level).
• Sells: 1224.6-1226.8 Tentative – confirmation required (Stop loss: dependent on where one confirms this area).
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