Daily Timeframe: Following the pin-bar retest of the daily Quasimodo support (now resistance) level at 1170.5 on the 09/03/15, Gold , as you can see, sold off.
Everything being equal, and taking into account that price has been consolidating for the past four days, we still (as per the weekly and daily timeframes) feel this market has further south to go yet, at least until price hits the small daily demand area coming in at 1131.4-1141.5 (encapsulates the aforementioned weekly decision-point ). The reason for this is simply because we see very little active demand to the left of current price.
4hr Timeframe: The reason for the ranging action being seen on the likely stems from the fact that buying and selling is clearly capped on the 4hr timeframe between a 4hr demand area seen at 1142.6-1152.1, and a small 4hr supply area coming in at 1165.1-1161.2.
A break above this consolidation would likely attract further upside towards the daily Quasimodo level mentioned above at 1170.5, which, in our opinion, could be a number to keep an eye on for selling opportunities this week. A convincing close above 1170.5, however, would be our cue to begin watching for price to retest this level as support.
On the other hand, a break below this range would immediately see price test the daily demand area mentioned above at 1131.4-1141.5. It would be at this point that we’d start observing the lower timeframes for buying confirmation around the 1142.0 mark.
Current buy/sell orders:
• Buy orders: 1142.0 (Predicative stop-loss orders seen at: 1130.0).
• Sell orders: 1170.5 (Predicative stop-loss orders seen at: dependent on where one confirms this level).