Gold is hitting major resistance around 1200, it broke out of shorter term fibonacci level at around 1190 and is consolidating around there at the moment of this post. What I would like to see most ideally is a false breakout on the upside past 1200, around 1206 (which is also a long term fibonacci level) and do a short below that. Even more ideal would be a on daily with the false breakout.
If it does not hit around 1206, I will be placing smaller position shorts below the current level now and adding positions along the way. This is a riskier trade so no single big positions are recommended. Smaller positions and adding on the way down is key for this kind of trade.
Targets: If this trade goes in our favour, my first conservative target will be around 1160 where a retest of the past support may be possible. Next conservative target will be 1140 (a retest of the shorter-term resistance line). With these conservative targets I will be locking in some profits incase of a false breakdown or a retest of the resistance to resume the uptrend.
A break through below the conservative target of 1140 will be very ideal and the next target after that would be around 1107 (a long-term fib level). Most ideal target would be 1020-1030, a break below previous lows to hit the long term support.
Remember that this trade is riskier and that small positions are highly advised (we can always add positions along the way everytime it pulls back up).
This idea is just my personal opinion and analysis, please trade with consideration and care.
Happy Chinese New Year of the Monkey to all, and happy trading!